Nils Hoffman (partner) and Agnes Claye (senior expert) from McKinsey spoke at the recent Corporate Financial Group roundtable event about the power of brands.
What did you speak about?
We talked about the importance of brands in B2B industries and in financial services. From our research, we know that brands matter, and they create bottom line impact—brands influence about 20 percent of a purchaser’s buying decision. One important revelation for B2B companies is how important the emotional dimension of the brand is. “Hard” facts matter, such as expertise, but the emotional components, such as “fits in well with my values and beliefs,” is an important element when B2B customers consider a brand. That reflects an important aspect of our research, which is that the core messages that companies communicate about their brands are often quite different from the characteristics their customers value most. Topics such as social responsibility and global reach, which many B2B companies emphasize, appeared to have a minimal influence on buyers’ perceptions of brand strength. On the other hand, two of the most important themes for customer perceptions of brand strength—effective supply-chain management and specialist market knowledge—were among those least mentioned by B2B suppliers.
We also discussed the need to think more carefully through all the touchpoints a customer has with a brand. The sales force isn’t the only place where customers experience the brand, which is traditionally where companies think about it. Today it’s also about the customer experience with the website, word of mouth, industry events , PR, etc. What’s really interesting, however, is that different touchpoints have different amounts of influence depending on where in the decision journey the customer is. That has big implications for how, when, and where companies communicate their brands.
What part of your presentation had the most impact?
What really resonated was seeing the data that demonstrated the impact of the brand. Senior marketers strongly believe in the power of the brand, but in practice they often find it very difficult to make the rest of the organization see and understand that. Another “aha moment” was seeing that the emotional dimensions of the brand really matter for B2B companies. In many ways, they have not been able to communicate their capability in the marketplace. For all the difficulties the banking industry has faced, for example, banks have also been enabling businesses to survive, invest, merge together and create funds for shareholders. But they don’t tell that story.
There was also some very interesting discussion about the leadership and innovation in the industry. This is an area where many financial companies have struggled. They realize that they need to develop thought leadership, which requires sophisticated publishing capabilities.
What was the most interesting thing you learned?
B2B financial services companies have a unique challenge when it comes to communicating their brand, because so many of them have a B2C arm of the business. And those commercial banks have large advertising and marketing programs already in place, which shapes the image of the entire bank. Many of these companies have a history of success, a strong heritage, and have provided lots of positive impact, but when it comes to thought leadership and innovation, their brand scores are low.