Darren Moffatt (00:02):
Hi there and welcome to the nerds of business podcast. My name’s Darren Moffatt. I’m a director of Webbuzz, the growth marketing agency. And I’m your host. It’s great to have you with us for episode six of the branding series. If you’re new to this podcast, our vision is to make entrepreneurs happier by solving the key challenges that all businesses must overcome. Today’s topic is brand equity, and we start with a few mystery quotes. The first is by one of the most famous entrepreneurs in the world. See if you can guess who said these words, ”
Darren Moffatt (00:39):
“Your brand is what other people say about you when you’re not in the room?”
Darren Moffatt (00:43):
That’s right. It was Jeff Bezos, founder and CEO of Amazon. And he should know because as of 2019, the value of the Amazon brand its brand equity was a whopping $315 billion. In fact, in the last year Amazon’s brand equity increased 52% to overtake Apple and become number one in the world. The story of how Jeff Bezos and the Amazon team achieved. This is too long and complex to deconstruct here. But another quote by a famous designer gives us a big clue as to how they did it.
Darren Moffatt (01:23):
“Products are made in the factory, but brands are created in the mind.”
Darren Moffatt (01:26):
That quote is by Walter Landor. Now you’ve probably never heard of him, but you know, his work back in the mid 20th century, he designed the Levi’s logo, the famous Coca Cola script and the visual identity for British airways. So he knew a thing or two about branding. Now this quote is deceptively simple, but it’s so profound. I think it might just change the way you think about your own business. “Products are made in the factory, brands are created in the mind”. Let’s break that down. The first thing to notice is the equivalence he’s drawing between products and brands. The implicit underlying assumption is that they’re both items to be brought and sold. He’s saying your brand is a product itself. The second insight contained in the quote is that the notion of brand is entirely abstract. It’s not a physical entity. So in the case of Amazon’s brand equity, that’s $315 billion of Goodwill. It has on its balance sheet that lives entirely in the minds of other people. That’s perhaps the biggest Jedi mind trick of all time. And to extend the very nerdy star Wars metaphor. There are some who think Jeff Bezos is the Sith Lord of modern day commerce.
Darren Moffatt (02:57):
The value he’s created for shareholders is immense. Amazon has undeniably destroyed thousands of smaller businesses in its long March to the top. As Scott Galloway argues in his brilliant book, ‘The Four’, Amazon has become so successful because they’ve mastered the art of selling the brand above all else. The Amazon brand story is itself. The most important product. If you’re building a business like most other entrepreneurs, you’re probably laser focused on your customers and the products you sell them. But what if that’s the wrong approach? If your dream is to one day, sell the business cash out and retire, then maybe like Amazon, the value of your brand. It should be at the heart of everything you do. So how can you grow brand equity to maximize the value of your business and create a better financial future for your shareholders, yourself and your family?
Darren Moffatt (04:23):
So the problem we’re trying to solve, and the title of today’s episode is ‘how to use brand equity to fatten profits and extract a higher sale price for your business’. We’ve got some great guests with some amazing, true stories and real life case studies up soon. You’ll hear our feature story about the billion dollar tech startup Airwallex walks. They head of global growth. Neil Luo reveals their plans for using brand equity to scale even further. It’s an interview that all businesses, no matter how large or small can learn from, but first here’s just a quick reminder that if you’re enjoying nerds of business, to please hit the subscribe button on your podcast player, it means you’ll automatically receive each new episode every fortnight. And it makes it easier for us to stay in touch. When it comes to branding some concepts such as brand awareness, which we covered in the last episode and brand loyalty for instance, are generally well understood. But brand equity I think is a bit more of a mystery for many business owners. So we need to start with a technical explanation of what it really is.
Rachel Bevans (05:40):
So brand equity is essentially the value that your brand has above it being a product or service. So if you think about, um, flying that has a certain value for you, right? So to travel somewhere by airplane, that’s got a different value to travel somewhere versus car, or what have you, right? So flying has a certain value, but then the next level above that is really the brand equity. So who are you going to choose to go with? So you’re going to choose to go with quantity. You’re going to choose to go with Jetstar. Are you gonna choose to go with Rex or whoever happens to be? And so that’s really the value, but the value is the sorry, the, the additional value that you get from a brand having equity. Um, so if you take, um, sort of, if you break down equity, what it’s made up of is brand awareness.
Rachel Bevans (06:32):
So how many people are aware of your brand? Okay. Um, it’s, uh, brand loyalty or the levels of brand loyalty. So whether they’re, um, whether it is their main brand or whether it’s their preferred preferred brand or one over a number of it within a repertoire, or whether they’ve just purchased it once, whether you’ve got a database of, you know, 200,000 customers, those sorts of things. I think you think about within that sort of brand loyalty aspect, um, your brand associations. So what are all of those associations with your brand? Is it safe for a brand like Qantas? They’ve got global awareness, so that’s pretty good in terms of brand equity. Um, they’ve also got, uh, in terms of brand loyalty, they have a massive frequent flyer campaign. They’ve got a lot of people who have flown frequently with them over the almost a hundred years that they’ve been extinct for.
Rachel Bevans (07:25):
So they have really great brand loyal, good, really great brand loyalty measure. Um, in terms of perceptions and associates, sorry, brand associations, this is where you associate Qantas with being safe, reliable the Australian spirit. Um, but you also associate it with perhaps more with business flying. So if I need to get fly somewhere on business, or I need to fly somewhere and know that I’m going to get there on time, the premium brand too. And that’s the fourth element, which is the perceived quality. So yeah, so they’re the four elements that make up brand equity.
Darren Moffatt (08:01):
That’s Rachel Bevans from the healthy brand company. She’s one of our two branding experts for this series. And she’s consulted to some of the biggest brands in the world. I asked Rachel, why is brand equity so important? And what opportunities does it create for businesses?
Rachel Bevans (08:19):
Yeah, well, so your equity is what’s going to get people to buy you in the first place. So you mean a potential takeover target? No, no particular potential customer potential customer, but we come back, we’ll come to that, the moment that’s the P and L side of things. Um, but yeah, so brand equity will help people choose you over your competitors. Um, it will help people pay a certain price for you as well. So there’ll be, um, they’ll be willing to pay that premium, the premium, which you are because you know that you’re getting X, Y, and Z. Um, so it’s really people buying it and for, uh, for the price and as often as you want it as well. So for the occasions that you want them to, um, so that’s the, I guess that’s the customer side of brand equity. What it does that all does then is also reduce risk for the business.
Rachel Bevans (09:08):
So the greater, um, brand equity you have, the more customers that you have and so forth and more that the less that you kind of have to use scrounging for cash flow. I mean, if you talk about that, I mean, I’ve talked about the Brown Quantis, but if you talk about that for a small, very small business where you are a service business in may, you’re providing brand consulting to other businesses. It’s really important that I get a level of awareness out there. So people know about me, they know what I stand for and what I deliver. Um, and for me, it’s probably less about brand loyalty because you already do a rebrand like your Brad every five years or so forth. So it’s less about that, but it’s like saying top of mind. So when it’s time for that to, um, to look at it again, and I’m kind of in their minds from the other, from the flip side, which is the commercial side, is that it, um, you can then translate that into brand value, which sits in on the, um, on the P & L. So essentially that becomes then Goodwill for that’s nerdy, P & L, profit and loss. Sorry.
Darren Moffatt (10:15):
So that then becomes your, um, yeah, so that’s your Goodwill. So that’s what people will pay for your business above and beyond their various assets.
Rachel Bevans (10:22):
So this goes to the, the value of the business. This is an asset. Um, this is part of the book value of the business. Um, and this means that, uh, if a business is able to grow their brand equity, they’re able to command, um, a greater multiple when they go to sell. So for those, uh, small and medium sized businesses who, uh, should have some exit strategy, um, often it will involve a trade sale. And so building that brand equity is a way to get top price when they go to exit. Yup, yup. Yup. And that’s why I think you often see people doing a lot of PR and press, uh, it it’s, it’s, they’re trying to bolster their brand before they flog it off, or they go to an IPO or so on. So they were trying to build that, that brand awareness, which sits nice, the brand equity. The other question that I have for you, Rachel, is around, um, extending the brand. What does brand equity allow you to do in terms of extending the brand with other product lines? For instance?
Rachel Bevans (11:28):
Yeah. So I think we touched on that before as well. So once you do have brand equity, we did within, I was trying to think of which examples we use, but it was when we were talking about Nike with their product launches. So yeah. And building anticipation for them. Yup. is a great example of where, you know, once you’ve got a certain amount of brand equity, then, um, you can launch new products and you know, that there’s going to be a, it’s easy
Darren Moffatt (11:54):
To extend the brand. If you’ve already got a lot of brand equity, you know? Yep. Okay, great. As long as you stay true to your brand, you know, you can, you’re going to go back to the strategy piece and the objectives as well. And so, as long as it’s true to your brand, it’s going to do well. So you can see that brand equity is super valuable to both your revenue growth, but also the longterm asset value of your business. In my encounters with top entrepreneurs, for nerds of business, this is something they’re all keenly aware of. One of our guests who’s already appeared several times on the show is a good example. Finder.com.au is a $250 million internet business that has built up some huge brand equity over more than a decade as a leader, in comparison, especially around financial services. I asked their co-founder, Fred Schebesta how they did it.
Fred Schebesta (12:47):
I think that it starts with some very simple tenants and principles. And I think we had our values of that business aligned. So we knew kind of who we were. And I’d say the first thing is, we’re very quick to know what we say no to. So we say no to negative language. Yeah. There’s enough negativity in the world doing it. Another one, how can you frame something in a positive way and inclusive way to bring people on the journey? That’s, that’s the first thing I think people go, Hey, this is kind of cool. We know these guys, they don’t hate on people. You know, the second thing is, uh, we don’t, we don’t really engage. Uh, we’re not a political company, so we don’t take sides. We’re very we’re for the customer. Right. And that’s all customers. And that’s hard. I says a lot of hard decisions that go in sitting in the middle. It’s actually quite easy to sit on one side, you’ve got to know who you’re fighting, but when you’re in the middle people complain, they go, Hey, you’re in the middle, come and join us.
Darren Moffatt (13:58):
Well, that goes to your brand positioning. Because I mean, if your, if you’ve chosen to be kind of in the middle, um, as you say, that is the hardest place to occupy because a lot of competitors will tend to cluster around the middle. The new entrants, younger, less to lose, can take a fringe position and pick off a lot of your early adopter customers and so on. So you’re being in the middle is hard. Um, but you’ve obviously got intense brand loyalty. You know, where does that come from?
Fred Schebesta (14:29):
I think that in Finder, we feel a deep purpose in empowering people with the decisions they make. And we realized the impact in some small way that has on people’s lives. And when you start from that premise and start from that place, and when we write to customers and we think about the situation they’re in, there’s something you can’t replace in those words, it’s just, it’s, it’s there, it’s written in every word and, and you know what we’re doing, we’re trying to get better at this every day. You know, we’re obviously it’s hard to do to mass scale, but that’s the central premise and tenant and the North star to empower people. And I think hopefully that vision, I think, clarifies that, you know, it, it sort of, you know, brings about a, a, a central theme that people can get by
Darren Moffatt (15:36):
And they, and your customers. And I, by the way, I, I went through one of your funnels and I checked it out. Um, I have done in the past, but not for some years. So I thought it was part of research. I check it out. Your customers, uh, are treated by your staff in the same way. So it’s not, it’s one thing to say all that stuff, but in terms of the brand values, it seems to me that you very successfully made that cascade down across the organization, uh, so that you could go back to a little running theme. It does become kinetic. It’s not just in the text and the language and the ringtones or whatever is actually in the lived experience of how people interact with your business,
Fred Schebesta (16:18):
Really good point. And, uh, and, and, and I’m glad that’s happening. And we can always do better. You know, we’re in constant beta, um, and people are comfortable with that in Finder. And I think there’s another, um, courageous thing that we do that I think some other companies find, find challenging. So the third value of founders go live and go live means we have a bias to action, a bias to putting things live on the internet for as long as the internet doesn’t exist, find them. And we will know that they, that’s just something where people say, we know if we’re going to go do something, we’re gonna do this. Yeah. Let’s go live. You know, that’s, that’s, that’s a, that’s a rally call here. Right.
Darren Moffatt (17:02):
But there’s a very, very big vulnerability in that, that when you go to launch something and you put your workings out in public, not internally, like sharing it internally is a great idea, you know, when people do that, but when you get your workings and you put it out to the public and it’s kind of half there, and it’s a bit bumpy and those kinds of things at Finder. We celebrate that go live. And then we have the courage and cultural acceptance of may, it may fail, or we’re going to get some pretty intense feedback. Yep. And that’s great. We love that. And I think that’s about, you know, again, being straight up and going live a there’s a, there’s a beauty in that
Darren Moffatt (17:46):
It takes courage. You know, it’s, it’s it’s to do that, but I would argue that, you know, you’ve built because you’ve built up such Goodwill with your customers, um, that it is a living brand. Um, it’s real, it’s authentic. That allows you to make some mistakes along the way. Now, in a minute, we’ll hear from another top entrepreneur who shares his experience too, but first let’s go back to our branding expert, Rachel Bevans for a technical summary of the classic strategies that even small businesses can use to grow their brand equity. How does a business build brand equity over time?
Rachel Bevans (18:25):
Yeah. By looking at those measures. Yep. So we’ve talked about brand awareness already. Yep. So you’d want to have as many people within your target audience, aware of your brand as possible. You want to be, um, essentially getting them to purchase the brand, engage with the brand of purchase, the brand loyalty, the loyalty thing coming back again and again. So you can go through those various levels of try initial trial to repeat purchase, to, um, purchasing more often and more frequently to purchasing, you know, uh, a business class flight versus a pre you know, an economy, flight training. Yeah. Merchandise, whatever, you know, um, wine club, et cetera. Um, and then going into the, I would never choose any other Brad other than court just to go anywhere kind of thing. So
Darren Moffatt (19:16):
That’s become this moving into brand advocacy then. Yeah,
Rachel Bevans (19:18):
Exactly. Exactly. So, um, you kind of get into there, um,
Rachel Bevans (19:23):
Then you want to boost the associations.
Rachel Bevans (19:26):
Yeah. And that’s where we’ve talked a lot about associations with our brand positioning in the first place, but it’s like, what are the jobs to be done? What are the needs that we are meeting, you know, business flying in particular and flying when I have to get there or fly and flying when I really want to be home before I’m home. Sorry. You know, they’re the, they’re the associations I have, but also those other brand key attributes for the brand. So, um, the safety, reliability, um, and Australian spirit are the ones I sort of associate. So they’re really where you build.
Rachel Bevans (19:57):
So there was a fourth element, perceived quality, perceived quality, right? Again, that’s, that’s obviously a key plank in product development and so on. So if a business, even a small to medium sized business or a startup or an entrepreneur, if they want to build their brand equity, then they’ve really got to focus within the, or beneath that they’ve got to focus on growing most of those four elements. And so that’s, you know, the brand awareness, that’s the brand loyalty, that’s the brand associations. And then the actual quality perceived, perceived quality, which is different from acting
Rachel Bevans (20:40):
Actual quality, but it does play a big part. So consider it again. That’s um, yeah. So making sure that you actually deliver
Darren Moffatt (20:49):
What you say you’re going to do, it goes back to that, that trust that that brand promise. Andre Eikmeier is the cofounder of online wine retailer, Vinomofo. You might recall Andre from our feature story all the way back in episode one on how to create a $100 million brand listen to what Andre has to say here about the role messaging played in growing their brand equity. So you guys built some really amazing brand equity at Vinomofo. So yeah. Tell us, how did you do that? Or, you know, what were the key pillars that allowed you to grow that brand equity and give you the freedom to, to grow the business the way you wanted to?
Andre Eikmeier (21:36):
I’d probably say purity and consistency. Like I think the amount of times we had to go had to focus on what we were going to be and who we were going to be for and had to let go of the incremental sales and incremental customer growth in order to stay relevant enough for the people that we wanted. And we had lessons when we tried to grow wider. I mean, it became less important for the people who were at court.
Andre Eikmeier (22:08):
You tried to extend the brand out, you tried to drop in other lines and extend the brand. And you found that, uh, the, what the brand loyalty or the engagement dropped off because
Andre Eikmeier (22:17):
Yep. And in fact, it was funny when we, we had a chapter where early on, where we sold a large part of the business and partnered with Catch Of The Day. And, um, and you know, in order to survive competitive tactics, Coles or Woolies, so it wasn’t dumb business decision, but then we had all these other, you know, we had all these customers or potential customers. You just want a cheaper one. And, um, and then we went, well, it’s wrong not to serve him. And we, we, we, you know, we talked ourselves around or maybe we can change, you know, good wine only cause we had this real thing, good wine only from the beginning. And then we started going, well, maybe just the best way that someone could afford and, and that’s still valuable and that’s still a valuable service and that’s not snobby. And can we talk to ourselves around with that? And we just had that ended up with the original people going, I see what’s happening here.
Andre Eikmeier (23:06):
And in fact, when we pulled it back from catching the day and we went out, we had literally, we were on a, we were on like doing about 10 million in revenue at that stage month to month, we literally doubled our monthly revenue and all these people going, yeah, I’ll come, Oh, thank God you brought it back. Yeah. I thought you thought you’d sold out a bit, but also we thought you didn’t need us anymore. And that was really interesting because we had gone out going, Hey, we just got Ashley and we want to do this. And people were like, yeah, I want to support you guys. That’s cool. Good on you somewhere else. They look for someone small and someone studying that was really humbling and really, I think less. So coming back from that, it was the, all the times that we went, no, we won’t be for them.
Andre Eikmeier (23:55):
And we’ve got to let go of that. We’ve got to stay pure. I use the word cure. Um, and that was an interaction that was a, that was really, that was how we built the brand and consistency in your messaging. And we didn’t always do that. Right. But when we did do it right, that’s what kept us building a brand that has value in equity. If you think about, I think what it is, you, you’re lucky if you can have people recall or feel one thing about you as a brand. So brands that do that well, or have done that well through time, like polo. No, they didn’t go, Hey, we’re fast and we’re reliable and we’re sexy and we’re safe. We’re saying to people, Oh, if I want a safe car, I’ll go there. I think that’s the trick. You got to just lock into one thing and be consistent with that one. Yep.
Darren Moffatt (24:40):
Yeah. There’s more power in that sort of singularity of, of, of meaning. Um, and yeah,
Andre Eikmeier (24:46):
No, she said, what do you want people to feel about you? You know, that’s,
Darren Moffatt (24:54):
I think that’s a great question. And I mean, that’s that, you’re my little pet theory on this is that that’s a question that most business owners and startups don’t think about enough. It becomes usually more focused on the product, on the use case, the market opportunity or what, but this idea or notion of how do people feel about it or what do you want them to feel about the brand? I think it’s super important. And obviously I’m not the only one, you know, there’s a whole sort of marketing and advertising industry built on that premise. But in the age of data, it’s not as prominent as, as it once was.
Andre Eikmeier (25:32):
Sorry, I will just say, add to that. So the consistency comes with when you’ve identified that it has to be through everything. Yeah. It’s really your language through the user experience, through the product offering through the way you sell through the decisions you make through the values you build your culture around has to be consistent so that nothing goes out. It’s no good. You build your brand around this. And then someone gets a generic customer service reply, or somebody goes, I’m sorry, we can’t do that because that’s against policy. It has to be overarching me, the driver, every decision and every part of the experience that someone’s going to have.
Darren Moffatt (26:07):
And we also asked Andre what his super power as an entrepreneur is. I think he’s answer really explains a lot about the success he’s enjoyed with Vinomofo and his other ventures too, such as the year of the planet. So Andre, we now need to know what your nerd super power, your super power. So as a business person, as an entrepreneur, um, maybe you’ve had time to reflect over the years. What is that one attribute of yours? That’s really consistently giving you a bit of an edge and, you know, helped you achieve what you’ve achieved,
Neil Luo (26:46):
Truth wow. Not facing or living or speaking the truth. So that means I’m always seeking it. Yep. I think that’s been, I think that’s fantastic. It doesn’t always work out well because a lot of time, if not balanced with empathy, that’s funny. Truth is largely intention rather than impact. It goes in, you’re focused on this, this trick behind this, right. I’m seeking the truth in something, whereas impact is largely around empathy and, and you know, so truth can hurt as we know. Um, but I think it’s, I think we’re in a day and age where we just got to face the truth, what we’re doing, why we’re doing it and everything. And as a brand, you’ve got to face the truth. What are we really in what we’re saying? What are we really are the decisions we’re making saying about us?
Darren Moffatt (27:43):
And now we come to our feature story in just five short years, Airwallex has achieved what is known in the tech world as unicorn status they’ve recently been valued at over $1 billion. Regular listeners will remember their head of global growth Neil Luo from the last episode today, Neil explains that the radical value proposition that Airwallex offers to SMEs who want to trade in foreign markets, it’s rapidly disrupting the world of foreign exchange and international payments and has already seen them establish some serious brand equity in the interview. You’re about to hear Neil shares, how they intend to leverage that brand equity, but even faster and wider growth for those listeners. Learning about Airwallex for the first time today. What does the business do? You know? What’s the mission and who do you help?
Neil Luo (28:37):
Yeah, no, it’s great question. So look where we started, we’ve actually got a really good origin story where we started was I found a, have ran a coffee shop around five years ago and he was trying to import coffee cups from China, uh, finding it really painful to pay the Chinese suppliers had to go to Western union. Uh, we got charged a massive margin just to pay the suppliers. And he said, look, there must be an easier way. And so from that was actually born air airlocks. And our mission is really to build global financial infrastructure that enables businesses to go borderless a lot more easily. And over the years that’s continually evolve. But I think recently we’ve launched a business account. That’s basically helping SMEs one open accounts, both domestically and internationally, really easily, uh, to send money, um, to suppliers, uh, to customers a lot more easily. Um, and three we’ve just recently released a card product that allows, uh, our customers to, uh, create a car for themselves or their employees, um, that has no effects, no transactions, international transaction fees. So if they’re buying things overseas, if they’re traveling overseas, uh, we can really save them money and time.
Darren Moffatt (29:48):
Great. So I’m a small business, either import goods from overseas or I’m exporting staff. The payoff to my business is, is less phase and an easier transactional process. Is that right?
Neil Luo (30:05):
Yeah. So I think there’s kind of, you know, probably two benefits. One is if you’re trying to sell overseas, if you need to create bank accounts overseas, we save you a lot of time. So we actually had a customer who spent nine months trying to open a bank account in the U S um, heard about our wallets. And we said, look, we can do that for you in essentially a minutes. And he was, he didn’t believe that at all. Right. So he kind of signed up for our product, click the button and got a bank account overseas. And he was like amazed at how much time it would save there. And then the second piece is very much around, uh, FX savings. So we’re around 90% cheaper than, than the banks. So if you’re doing a significant sum, you know, paying suppliers, we can actually unlock quite a lot of cashflow for small businesses. Um, and we know how important that is, especially in this kind of current environment
Darren Moffatt (30:49):
On the topic of brand equity for air Wallacks. Um, can you maybe give us some insight into your future growth plans? Like what are the, some of the ways that you guys intend to leverage the brand equity that you’ve built for the future?
Neil Luo (31:03):
Yeah, no, it’s a good question. Um, we, we probably need to, we probably are going to practice what we preach, right? So we, we tell businesses go global from the outset and we’re doing that exactly that. So, you know, we have a very global ambition. You know, we have a strong presence in China, a strong presence in Australia. We’re very keen to grow our business in the UK and EU, uh, in the U S as well. And as we speak, we’re actually also applying for licenses in Southeast Asia and the middle East, um, and in India, for example, as well. So we have this kind of real global mindset, um, that, you know, Australia is not super big and to grow substantially, we actually have to, um, grow internationally. Um, and the second thing is, you know, we’ve really focused on kind of building that brand equity, um, faster, right?
Neil Luo (31:55):
And digital is one way to do it. Uh, partnerships is another way to do it, but we know that the, the, the right way to do is actually to go brand advertising at some stage, like above the line. But in order to do that, you need to make sure that your product is at a state where customers are very happy with it. You know, the onboarding experience is seamless. The product itself is seamless, and you get a really, uh, good return on your brand investment. Um, so we’ve really focused on kind of, you know, getting the right metrics in place, really focusing on NPS that customer NPS, both from a onboarding and a kind of repeat user perspective.
Darren Moffatt (32:32):
I’ve got to hit you up with another nerdy NPS again, I think I know what that is, but you might just want to unpack for our listeners.
Neil Luo (32:40):
Sure. So NPS stands for net promoter score. So essentially measures the percentage of your customers that will say that they’re very, very likely to promote your product minus the percentage that said, they’re not really, they’re not very happy with your product. So usually a positive NPS is, is good. Um, and kind of, you know, general terms, but we’re, we’re looking for kind of something over 50, which is very aggressive, but we’re really keen to get that over 50. So we’re very comfortable that our product is in the right place. Um, and then we’ll, we will most likely then go with a very aggressive above the line campaign, um, in our markets.
Darren Moffatt (33:16):
Great. So I think what’s really important there for listeners to understand is that the way you are executing or rolling out your marketing is highly strategic, um, as you would expect it to be, you know, you guys are already, um, got a billion dollar valuation, you’ve got some very serious investors, um, on the share register, but you’re deliberately holding the branding back until all the foundations are. Right. Yeah. And, and so has that been, uh, is that a, is that a new strategy? I mean, the temptation must have been to go to branding stuff early a bit earlier. Um, how did you guys arrive at that? Take us through that discussion.
Neil Luo (33:55):
Yeah, so I think, I think the challenge with brand marketing is that you spend it and then it’s gone, right? And so if you have a leaky funnel, um, essentially the money just leaks out. And even though we weren’t, well-funded, you know, the, the way we manage our resources is very, very important. Um, and you know, we, we did a bunch of tests as well. So, you know, this is without data, we did it by new tests, but we realized that, Hey, look, um, the price still needs a bit of improvement to make sure that we are comfortable enough in pushing a lot of brand into it. And so we made a deliberate decision to invest in channels that are more evergreen where, you know, 1 cent now we’ll still be there in a year’s time. So content big focus for us, partnerships, big focus for us because these things get maintained over time, right?
Neil Luo (34:43):
Whereas brand, um, it’s very important. You know, a lot of people get wedded on brand as the growth engine, uh, initially, but it can be very dangerous as well. One because, um, you know, if competitors bid up, it gets very expensive, very fast. Um, but secondly, if your product is not optimized, uh, it can be very expensive, very fast as well. Um, we were lucky enough, I think in that, you know, the top end of B2B, kind of the enterprises and the mid markets, a lot of that’s relationship period. So we probably don’t need a lot of brand. We can actually have the right product and the right conversations and get traction. Um, our next phase is getting the content and the partnerships to kind of grow that second phase. And then our final phase is going to be that above the line. But we’re very conscious that we need to get plugged holes, so to speak before we push aggressively, um, in, in that space.
Darren Moffatt (35:33):
So the problem we set out to solve in this episode was how to use brand equity, to fatten profits and extract a higher sale price for your business. Our branding expert, Rachel, from the healthy brand company explained what brand equity is and why it’s so important. And we’ve also heard some fascinating, real life, true stories from our entrepreneur, guests, Andre, Eikmeier at Vinomofo, Fred Schebesta at Finder and Neil Luo from Airwallex. I hope their wisdom and insights have given you ideas to crack the code to growth in your own venture for me. However, there are three important takeaways from this episode. Firstly, you need an integrated approach. If you’re serious about growing your brand equity, everything from awareness, loyalty, associations, engagement, and alignment all need to come together in a coordinated way. Secondly, to achieve that you’ll need strategy, planning and measurement not to mention good execution.
Darren Moffatt (36:37):
Brand equity is a valuable asset. It’s no accident when it happens and it doesn’t grow overnight. Finally, consistency and timing are important. We heard from Andre that purity of messaging was essential to the success of Vinomofo and Neil from Airwallex had some brilliant insights into getting the foundations of your business right before you go and invest heavily in brand marketing. As we heard at the top of the episode, Amazon has become the biggest company in the world because of its relentless focus on selling their brand above all else. Although very few of us indeed will ever get anywhere near that scale too often, small businesses get lost in the day to day grind of operations and forget the bigger picture. If you want to enjoy higher margins or sell your business for top dollar in future, the success of Amazon teaches us that a consistent focus on brand equity might just be the best investment of all we’re coming to the end. But before we go, it’s time for our regular segment nerd under pressure where a guest has to share one killer hack or tip, they recommend for you. Our listeners let’s find out who our nerd under pressure is today. I’m now gonna bring you to a little segment that we have. Um, and this is called…
Darren Moffatt (38:05):
Nerd under pressure. So Fred Schebesta, this is where we give you five seconds thinking time. Um, what’s one killer hack you could give to other entrepreneurs or business owners for growing brand equity. Your time starts now. So I think the first thing is to perfect
Fred Schebesta (38:36):
the one sentence that communicates your business and the reason why is because you’re going to tell that story for a long time. Do you ever get sick of telling that story? I love it. I love it. It’s another chance for me to keep testing myself.
Darren Moffatt (38:47):
I get that they get that across, right? Did that come up?
Fred Schebesta (38:51):
You know, I think, you know, the way in which I’ve tried to explain now, Finder is, you know, it’s a place where you go into find a better deal. Yep.
Darren Moffatt (39:00):
There it is one sentence that took a lot of work. Yeah. Okay. I better do it, but what’s your, what’s your,
Fred Schebesta (39:07):
You know, for a business owner, I think once you can communicate that and boil down the service that the product that you’re offering in the simplest way that your six year old daughter can explain it back to you. Yeah. That’s what
Fred Schebesta (39:25):
I said, Portia what does this ad say? What is it?
Fred Schebesta (39:27):
What is Finder? What is it? It does. She said, Oh, that’s what you go to do the credit cards and get a better deal. And I was like, okay.
Darren Moffatt (39:36):
So thanks for listening to the sixth episode of Nerds of Business. If you’ve enjoyed it, please leave a review on Apple, Spotify, Google, or wherever you listen to your podcasts. It helps us climb up the ranks and become more visible to other people. Just like you remember, we want to help as many entrepreneurs and businesses as possible. You’ve got a question or some feedback we’d love to hear from you. You can engage with us at webbuzz.com.au/nerds. So feel free to reach out and say hello. I want to thank all of our guests and the team at web buzz for helping me put this show together. We’ll be back in two weeks with our next episode, which is on brand loyalty. Until then I’m your host, Darren Moffatt. And I look forward to nerding out with you next time. Bye for now.