BRAND-BUILDING IS THE KEY TO ENHANCING AN SME'S COMPETITIVENESS AND PROFITABILITY
“A brand is the intangible sum of a product's attributes: its name, packaging, and price, its history, its reputation, and the way it's advertised.” David Ogilvy
Malta has been experiencing rapid economic change. Various sectors, such as financial services, IT and tourism, have undergone greater development and have attracted an increasing number of overseas brands to relocate to or tap into the Malta market. In a business environment filled with opportunities and challenges, brand-building may be the direction SME’s need to take to enhance their competitiveness in Malta. Ogilvy Malta, part of Ogilvy & Mather Worldwide, is a branding company with an expertise in niche markets.
BUILDING YOUR BRAND TO BE MORE COMPETITIVE A brand is a product, service, or concept that is publicly distinguished from other products, services, or concepts so that it can be easily communicated and usually marketed. A brand name is the name of the distinctive product, service, or concept. Branding is the process of creating and disseminating the brand name. Branding can be applied to the entire corporate identity as well as to individual product and service names. A brand is a symbol, a means to differentiate one product from another. The implied “message” lurking behind the brand includes company image, the quality of the product and a promise of performance. The function of a brand is to position the enterprise in the consumer’s mind. After the brand is established, it will not only retain long-term customers but also attract the interest of potential customers, thereby effectively enhancing the competitiveness of the enterprise. Most local people think that brand-building requires extensive capital and technology which is the approach generally taken by blue chips. As SME’s are mostly small and working with scarce resources, the approach taken to brand-building is also very different. In fact, by authentically expressing their brand identity and adopting an adjusted mechanic to brand-building through easy-step development in a moderate and modular manner, taking a step at-a-time towards its goal, SME’s can also build their own valuable brands for stronger sales and better business performance.
3 STEPS TO BRAND-BUILDING FOR MALTA’S SME’s
1. LEVERAGE STRENGTHS THROUGH CORE VALUES Brand building is a never-ending on-going process. In David Ogilvy’s view SME’s should prepare a long-term plan before establishing a brand and the plan should be implemented in stages. Firstly, SME’s should identify the core value of the brand, as brands can be classified as product brands, service brands, consumer brands or corporate brands. The SME should first define the nature of its product and service and identify its major target consumer group before it can customise its strategy to meet customer demand. Malta’s SME’s are mainly involved in the service sector and since customers nowadays attach great importance to “experience spending” or “retail therapy”, seeking a form of satisfaction in the course of consumption, therefore, it is suggested that local SME’s should start with building their brand in service. Compared to the large enterprises, SMEs also have some advantages when building a service brand. For instance, the small size allows for fast decision-making and higher flexibility, enabling the company to make prompt strategic adjustments in response to customer demand. Local SME’s can make use of Malta’s abundant cultural resources by making its own brand into a unique style different
from overseas brands on the strength of the Island’s heritage. Brand Malta is a resource that belongs to all of us and we should feel free to make use of the pillars that comprise that brand, namely - Heritage, Hospitality and Diversity. For instance, The Xara Palace Relais & Chateaux in Mdina has a Maltesefusion restaurant called de Mondion that portrays itself with a luxury image and makes use of the noble history of the citadel that infuses both the cuisine and the theme of the restaurant. The success in building its style and image has turned the restaurant into a major tourist attraction. Recently, The Xara Palace Relais & Chateaux was named one of the top 10 castle hotels in the world by Fox News, and this accolade follows features in Condé Nast's Vanity Fair, The Wall Street Journal, Diplomat Magazine, and visits by celebrities such as Brad Pitt and Angelina Jolie, Sharon Stone, Orlando Bloom, Jennifer Anniston, Bruce Willis, Simply Red's Mick Hucknall, Josef Calleja, Lucio Dalla, Rupert Everett, and a raft of VIP's, politicians, entrepreneurs, business leaders and other prominent figures. Not bad for the smallest hotel on the Islands, with only 17 rooms! All their success is built on leveraging their brand.
“If it doesn't sell, it isn't creative.” David Ogilvy
2. COPYRIGHT PROTECTION Being creative means pushing the standard higher, moving towards the new, the never-thought-of. This form of “innovation” helps drive differentiation and competitive advantage through ownership of defined brand assets, such as original designs for logos, high-quality communication, distinctive advertising with higher production values, authentic and original photography, and various other intangible assets. Brand building requires the well-crafted design of a brand namestyle and identifier of the product and services involved – normally a bundle of the two. An outstanding piece of design development or a clever brand name can draw the attention of a great number of consumers, raise the value of the product and services and become an important asset of the enterprise. Therefore, SME’s should increase their awareness
of trademark protection and eliminate the possibilities of trademark pirating. Malta has very reasonable administration fees for various industrial property registrations including those for trademarks and patents, as a measure to encourage enterprises to explore intangible assets. This type of brand-building and brand protection help the SME to develop ownership of their market through the recurrent revenues enjoyed by the brand. Integrity is an important foundation of SME brand development and allows a believable and engaging brand promise to emerge and be maintained by the business for longterm revenue harvesting. A relatively recent Maltese start-up to recognise the importance of brand protection is the new smoothie brand Dr. Juice, which now operates 7 outlets and has expanded their brand franchise to Italy.
3. TURNING BRANDING TO COMPETETIVE ADVANTAGE When engaging in promotion and marketing, local SME’s usually cannot invest substantial amounts in a large advertising campaign. Maltese SME’s, however, may still publicise and promote themselves through other effective channels. For instance, by participating in international exhibition activities through the delegations regularly organised by Malta Enterprise, FinanceMalta, Malta Tourism Authority and other entities as well as taking part in overseas exhibitions which may help to increase the exposure of their products and also provide an opportunity for SMEs to exchange views with overseas counterparts and gain inspiration for new ideas. Local SME’s therefore can seize the opportunity to take part in various activities and market their products to overseas trade visitors, source business partners and buyers and explore new markets. Ascent Software in Luqa has taken this approach for the last 7 years and has built a portfolio of international brands which have turned them
into the most profitable IT business in Malta. Their effective use of trade fairs, collaterals, editorial features in trade journals and exhibition catalogues together with dedicated commitment across digital channels has been instrumental in establishing their brands as credible alternatives in international markets, backed by Maltese entrepreneurial flair. Ascent’s success is proof that Maltese SME’s can compete successfully in international markets and develop those markets to serve their base in Malta, creating local employment and earnings derived from outside the local economy. By quickly mastering new opportunities in the social media sphere, it is possible for brands to have a reach, and to build a responsive network of suppliers, staff, customers and stakeholders which put the SME-brand centrestage at a fraction of the cost involved in traditional media channels such as television, newspapers or radio.
“You now have to decide what 'image' you want for your brand. Image means personality. Products, like people, have personalities, and they can make or break them in the market place.” David Ogilvy
SME BRANDS ARE ABOUT BUILDING AND DELIVERING VALUE The small business defines Malta’s economy. We are almost all operating small businesses. We are not alone. More than 99% of all European businesses are Small and Medium Enterprises (SME’s), and these have been especially hard hit by the tightening of credit and the weakening economic outlook. All economies within the EU are completely dependent on SME‘s representing around 95% of each Member State economy. If you are the owner of a small business, you may have wondered about the necessity of branding your small business. Creating a brand identity is absolutely crucial especially if you are competing in a market that is saturated with other busi- nesses selling the same product or service as your business does. The Maltese SME ‘brand’ is beginning to emerge and is a combination of quality and mark or sign. By making full use of their own unique features, wisely using resources and strengthening competitiveness, their brands will be built up gradually to deliver higher value. Audiences now expect brands to be online and small businesses can use the internet and social media to their advantage, increasing brand awareness and extending reach on a national or international scale. If you are a small business owner you will no doubt want to spend your marketing resources where they will have the greatest impact – on developing a brand and taking care of your customers and your community. Every business wants to be a customer's first choice. Building and managing a brand can play a significant part in achieving that goal.
Source: Confessions of an Advertising Man (1963), David Ogilvy Blood, Brains and Beer (1978), David Ogilvy Ogilvy on Advertising (1983), David Ogilvy Ogilvy & Mather The Red Papers: Learning to Read the River Ogilvy & Mather The Red Papers: What’s the Big Ideal? Ogilvy & Mather The Red Papers: Socialise the Enterprise Author: Edwin Ward, Creative Director at Ogilvy Malta Contact Edwin at edwin@ogilvymalta.com www.ogilvymalta.com
Important Notice: All information is for reference only. While every effort is made to ensure the accuracy of information, Ogilvy Malta will not be held responsible or be liable for failing to guarantee the accuracy of any information provided, nor for any damage caused by inaccurate information or omissions.