What is the return on investment (ROI) of branding? It’s a question many CEOs and CFOs ask their marketing executives. Although hard to formally calculate, it’s an extremely important question to answer. However, there are no easy answers.
In a recent CUNA Marketing & Business Development Council white paper, “Designing an Integrated Branding Approach,” we explored the concept how your brand encompasses everything do, everything you are and everything you market. The paper dived deeply into trends, how to develop an integrated brand, integrated branding tools and tactical ideas.
As part of the paper, we interviewed a number of branding experts. However, due to length we couldn’t capture all their comments. One particular question we addressed in the paper was “what is the ROI of branding?” Below are answers (not covered in the paper itself) that five experts provided to this challenging question.
Amy Davis, Vice President of Marketing with Red Canoe Credit Union in Longview, WA ($580 million assets, 55,000 members)
We must remember that integrated branding is more of a marathon than a sprint. It is a long-term play. Consumers don’t change banks until they hit a point of pain. When they finally hit that point of pain, you need to be in that consideration (top 3). Keeping your credit union in the top of mind for that conversation is part of branding’s ROI. We look at loyalty and repeat business. If you have a strong brand you will get more loyalty and word of mouth.
Kathryn Davis, Senior Vice President with Xceed Financial Credit Union in El Segundo, CA ($741 million assets, 58,000 members)
That’s always the $64,000 question with marketing-oriented activity! With integrated branding, though, it’s so much more because there’s so much more involved. Branding is led by the Marketing team, but when it’s done right, everyone in the organization is pulling together in the same direction. Retail, operations, facilities, human resources, information technology, and even finance play essential roles, so specifying ROI is tricky. We also think that successful enterprises of the future will be those that collaborate with their customers to build their brands, so we’re also moving toward incorporating Net Promoter Scores which group respondents into useful groups: Detractors, Passives and Promoters.
Eric Gagliano, Senior Vice President for Client Management at MarketMatch
What is the value of Sistine Chapel? It is priceless—yet measurable. Look at your overall business model: deposits, loans, types of accounts, average accts per households, fee income, debit card usage, checking penetration, attrition rates, retention, referrals, etc. Take c baseline before your focused brand effort—then again every quarter there after. You WILL see positive change.
Roy MacKinnon, Vice President of Marketing at First Entertainment Credit Union in Hollywood, CA ($1 billion assets, 65,000 members)
How do you measure a print ad seen by 50,000 people? There is really no way to do it. Branding is just believing in the power of consistent, long-term advertising. How does Nike measure ROI of the swoosh?
Ask yourself—are you growing at all levels? Are you lowering the average age of your members? If so, you’re getting a decent ROI out of your branding. Always come back and ask “is this who we are?” and “is the staff delivering on our brand?” You answer this by observing staff at the branch level. Work to meet member needs rather than sales quotas.
Bryn Johansen Vaupel, Senior Vice President of Marketing with Education Systems Federal Credit Union in Greenbelt, MD ($750 million assets, 94,000 members)
The ROI in branding is tracked in each promotion and campaign you do with your members. It’s about direct response—did the person who opened a car loan receive your auto loan mailer, but also about indirect response- did the person who received your mailer not need a car loan but instead needed a checking account for the student going off to college and thought of you because your brand had an affinity for them. Members have to be aware that you exist and understand your brand before they can decide to buy from you.