Visual Branding & business

Recently, the chief editor of a big advertising magazine wrote in her editorial: ‘design and business; never the twain shall meet’.

Her opinion illustrates two things:
a) the gap that exists between marcom/business and design - one of the driving forces behind Visual Branding
b) the state of denial that part of the advertising industry still lives in.

How does design actually relate to business; how do you connect design to business?

This has got to do a lot with organisation, with the internal governance of visual branding. I look at it like this:

Chain of Visual Branding

Design is very much judged on its output, on what people see. Many companies that are dissatisfied with their design will start a project to create better design. But if they don’t see design as part of a business process, as part of an interactive chain in the organisation, they will keep ending up with dissatisfying design. Like the guy that brakes up his third marriage and still thinks his partner is the problem.

If you want to achieve a situation in which the output, the design, is really consistently successful, all four elements of the chain need to perform above average. The chain is as weak as its weakest part.

In this outline I will look at this chain and indicate how companies can improve the visual performance of their brand. I will focus mostly on ‘strategy’ and ‘organisation’.

Brand strategy: the only element of branding where design is truly invisible

In previous outlines, I already stated that the visual part is the most important composing factor of a brand: we live in a visually based society, a brand hardly has any invisible assets, but a multitude of visible expressions - from packaging, to product, advertising etc. etc. So without neglecting the power of marcom and actual behaviour (employees, retail, internet): visual branding is the key asset of a brand in this 21st century.

Therefore it is surprising how little attention design gets when it comes to brand strategy. A few observations: research into brand perception normally pays no attention to design; brand tracking research normally pays no attention to design and is limited to advertising effects (therefore it really isn’t brand tracking but advertising tracking); brand strategy documents pay little attention to design; external brand strategy advice is most likely to be recruited from advertising agencies or independent consultancies while neither of them has real knowledge or authority in the field of design.

Another element is the financial side of brand strategy. I worked in advertising myself and for a long time I considered the difference between advertising budgets and design budgets logical. And of course: the bulk of advertising investments is media budget. Still, I see two symptoms:

• the ‘invoice – deliverable ratio’ of advertising agencies is extremely high compared to design agencies. Without judgement of quality: the amounts of money advertising agencies are allowed to charge for equal or comparable deliverables is much higher. It means the value perception is higher. But also: the ‘industry standard’, the habitual level of what a client finds financially acceptable, is higher. The next ten years will show further pressure on the earnings/fee structure of (traditional) advertising agencies and growth in the design industry.

• High media costs or not: budgeting is an expression of strategy, of choice, of priority. And in this respect too we will see change: a shift from advertising to design.

I give two examples. My own agency is in the process of creating a European/international brand, online brand for an international company. The brand will have no physical presence, it will be totally online. In other words: the internet concept we created ís the brand. It is the vehicle for marketing, communication, interaction, sales, service, fulfilment. The concept will be used in all European countries but probably also outside Europe.

The marcom budget for the first individual country where the concept will be introduced is about 4500% of our budget. So marcom in one single (not too big) country is budgeted 4500% of the creation of the international brand itself.

We have not one complaint about the co-operation or the budget, on the contrary. I am just providing facts that indicate the way of thinking in the industry. The example is probably quite common.
Another example: the Philips Senseo. The whole budget for the agency involved in creating and developing the (industrial) design of the product itself, was less than the budget for the photo shoot for the first print ad.

I think it is really important for business and marketing professionals to be conscious of the choices they make in this respect. ‘But if the agencies do the job, why pay more?’ the brand manager might think. He or she is right if design should stay on the level and position it is at. But that doesn’t seem wise.

If design can achieve such great results with so little budget, imagine what more it can do for your brand if you were to invest more.

If you want to achieve more with design: create a bigger competitive edge, more communication power and more brand equity, then budgeting surely should reflect this ambition. Put your money where your ambition is. Not as a purpose or solution, but as a result of a strategic choice, a business opportunity.

Again I refer to Apple as an iconic example: a worldwide super brand, hardly spending a dollar on marcom. Design is key. That is not a matter of coincidence; it’s a matter of choice.

The horizontal organisation

Small companies or big companies, single products brands or multilayered brands; governing a brand is a complex matter and a continuous battle. 

The average organisation concept around a brand is a professional in charge of the brand, supported by one or more experts in, usually, marketing/marcom. It is too expensive to have a complete staff of experts. More specialised expertise (media, direct mail, sales promotion, retail, internet, events) will be found in central staff departments.

The basic premise of all this, is a vertical organisation concept: the structure is based on vertical lines of responsibility and expertise.

Therefore, the big challenge for companies is to make all these vertical lines work together, to integrate expertise, to achieve a holistic approach of the brand. That’s why we talk about multichannel, media-independent etc.

The company has to integrate the virtues of a matrix organisation; a horizontal orientation in addition to the predominant vertical organisation structure.

And design, maybe most of all, is an expertise that is regarded as a completely separate field of expertise. Not many companies have a design manager. And if there is one, he or she is often regarded as another approval hurdle. The designmanager normally has little power except perfect servicing (‘no complaints, it can be handy to work with him’), perseverance, personal charisma and sometimes budget.

Visual Branding (see: outline 6) by definition and by nature requires a horizontal approach. This means for instance that:
1. Visual Branding is at the core of branding, marketing, business - it is regarded as a source of (marketing) innovation, business opportunity, market strategy, company culture and company development;
2. A horizontally composed brand DMU (decision making unit) has a decisive role in the overall management of the brand, including visual branding as a priority area;
3. The manager in charge of Visual Branding has authority in the company, he/she is leading and well known inside as well as outside the company;
4. Visual Branding is integrated in the ‘mental infrastructure’ of the professional staff; they are experienced and/or trained in the relevance of Visual Branding;

I am not saying Philips is a perfect example of Visual Branding but Philips surely is a very strong example of a company that has put design at the core of its business/brand strategy. It is really serious about that and organises the company structure according to the strategy. You see this choice reflected in policy, budgeting, organisation, tools and output. For Philips, design is a thing that matters.

In the coming years, more companies will follow.