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Start-Ups Need a Minimum Viable Brand

Start-Ups Need a Minimum Viable Brand

by Denise Lee Yohn  |   1:00 PM June 13, 2014

Sometimes it seems like Steve Jobs’ notorious reality distortion field has extended to all of Silicon Valley. Some eager entrepreneurs think their new product is so brilliant and so unlike anything else out there, that they just need to make it available and people will start clamoring over it. Other start-ups develop a core technology that has myriad possible uses and they’re not quite sure which will be most appealing, so they plan to just put it out on the market and let customers decide.

Approaches like these overlook the importance of brand strategy as the foundation for a successful launch. Having a brand strategy in place ensures that your internal team is aligned around the same goals, and helps determine how you plan to differentiate your product and win loyal customers. Real artists may indeed ship, as Jobs famously exhorted his team, but savvy businesspeople don’t do so without at least a basic brand strategy in place.

It may be tempting to skip brand development in the rush to get a new product to market. Most entrepreneurs are as short on cash as they are on time and they don’t think they can afford to spend either to attend to brand-building. And some people mistake product strategy for brand strategy, without realizing that a compelling brand is comprised of so much more than a product idea.

Since launches should be grounded in a brand foundation while at the same time being pursued with agility and speed, today’s entrepreneurs require an alternative to a complete, robust brand platform. Tech start-ups employ the Minimum Viable Product (MVP) concept, made popular by Eric Ries inThe Lean Start-Up, to test product hypotheses with minimal resources. Using a Minimum Viable Brand (MVB) concept can ensure those hypotheses are grounded in strategic intent and market insights.

A MVB is comprised of the core elements of a brand that are necessary to ensure internal focus and alignment as well as external relevance and differentiation. A framework for defining and developing a MVB is the “6 What’s”:

what we stand for – our brand essence

what we believe in – our defining values

what people we seek to engage – our target audience(s)

what distinguishes us – our key differentiators

what we offer – our overarching experience

what we say and show – our logo, look, and lines (messaging)

These six elements cover the basic tenets that should be clearly articulated and commonly understood within an organization prior to it finalizing and launching a new product – and they leave out a fuller dimensionalization of the brand which isn’t necessary at first. Usually the MVB should be established through a couple of focused work sessions among the company leaders and perhaps a creative resource and an external facilitator to provide an objective perspective.

Several principles should inform the development of the MVB elements:

First, every organization should be brand-led and market-informed. Contrary to popular opinion, customers don’t own brands; companies do. Of course customer perceptions of a brand determine the strength and value of a brand, so brand managers must carefully cultivate the proper perceptions. But it would be a mistake to leave it to customers to determine the defining attributes and values that comprise the brand.

As the developer of a new product or solution, a business leader must have a point of view about what their brand stands for and the value they’re offering. This point of view should guide everything the organization does. If they don’t have it figured out, it’s unlikely customers will. A brand strategy may start only as a hypothesis that gets validated – or not – by market reaction, but it should be clearly defined before the product is introduced. That’s what “brand-led” means. “Market-informed” means that the founder’s point of view should be informed by market understanding. Customer insights, competitive dynamics, and broader contextual factors like socioeconomic trends should shape the brand strategy, but not drive it.

The MVB should be guided by the principle that focus is essential for new product viability. A brand should be positioned in a specific way to a specific target customer. Some entrepreneurs may fear that focusing their brand appeal will alienate potential customers – especially when market demand is unclear. But the exact opposite is true. When brands embrace and embody a clear identity and unique positioning, they attract people who are most likely to be loyal, high-quality customers. Think Red Bull, with its buzz-building marketing campaigns, and Harley-Davidson, with its loyal customer base. Actively segmenting the market and seeking out a particular target not only helps with resource allocation, but also cuts through all the noise out there and sends a powerful signal to those customers. After an initial launch, it may be necessary to refine the brand focus and rethink customer targeting, but being open ended from the start is a surefire way for a new product to end up meaning nothing and appealing to no one.

Finally the MVB should be grounded in emotional appeal. There are very few, if any, truly new-to-the-world ideas anymore, which means new products are usually based on nuance or detail, e.g., a new feature or functionality. The problem is, customers rarely notice details and even more rarely value them as much as their creators think they will or should. Of course, novelty usually generates some appeal in the short-term, but decreasing customer attention spans and aggressive competitive imitation makes it difficult to sustain appeal of a new product detail over time. To be perceived as truly distinctive, a brand must convey more compelling, sustaining differentiation and the best way to do so is through emotion. Tying product details to emotional values and seeking emotional connections with customers cultivates more meaningful, sustained customer relationships. (Apple does a great job of this, as the following ad conveys:

The approach to developing and launching a new product is certainly different in today’s information-rich, technology-fueled, and time-constrained business environment. Start-ups now create, evaluate, and refine their offerings iteratively, often expecting to have to reset or pivot as mistakes are made and information is gleaned. But being agile and responsive doesn’t require a ready-fire-aim approach when it comes to brand strategy. An MVB provides the right balance of structure and flexibility.

 

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About bambooinnovator
KB Kee is the Managing Editor of the Moat Report Asia (www.moatreport.com), a research service focused exclusively on highlighting undervalued wide-moat businesses in Asia; subscribers from North America, Europe, the Oceania and Asia include professional value investors with over $20 billion in asset under management in equities, some of the world’s biggest secretive global hedge fund giants, and savvy private individual investors who are lifelong learners in the art of value investing. KB has been rooted in the principles of value investing for over a decade as an analyst in Asian capital markets. He was head of research and fund manager at a Singapore-based value investment firm. As a member of the investment committee, he helped the firm’s Asia-focused equity funds significantly outperform the benchmark index. He was previously the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. KB has trained CEOs, entrepreneurs, CFOs, management executives in business strategy, value investing, macroeconomic and industry trends, and detecting accounting frauds in Singapore, HK and China. KB was a faculty (accounting) at SMU teaching accounting courses. KB is currently the Chief Investment Officer at an ASX-listed investment holdings company since September 2015, helping to manage the listed Asian equities investments in the Hidden Champions Fund. Disclaimer: This article is for discussion purposes only and does not constitute an offer, recommendation or solicitation to buy or sell any investments, securities, futures or options. All articles in the website reflect the personal opinions of the writer.

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