Our Thinking

Tech Companies + Branding

May 1st, 2018

THE RATIONAL
OF EMOTIONAL
ATTACHMENT-
WHY SHOULD 
TECH COMPANIES 
CARE ABOUT 
BRANDING?



The power of emotional attachment in consumer marketing is evident, but why do technology and engineering-based companies in the BtB sphere only focus on what they deem to be rational elements in their marketing? Why do leadership teams dominated by engineers so often refuse to take emotional brand attachment seriously?
  
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As my first master’s degree is in engineering, I do remember how we were supposed to think: identify, isolate and reorganise the problem, apply equations, resolve, simplify and present the solution. Remember to double underline the final answer. So, in this article, I will try to attack the problem of emotional attachment to brands in an engineering way.

I will approach the problem by using Saatchi & Saatchi’s “Lovemarks” model. In this model, brand strength is measured along two axes, the vertical axis defines the Respect that a brand has with its stakeholders, while the horizontal axis defines the Love they have for the brand. I know, Love is hard to measure, please bear with me anyway. In the model, scores LOW/LOW define products, e.g. paper clips, cement, toilet seat covers and probably anything that is really just consumed. The LOW respect and HIGH love corner is reserved for fads, things that we love for a short period of time for some difficult to explain reason, like Pokemon GO or hula hoops. 

Brands are given HIGH respect and LOW love, perhaps Intel could be such an example. The upper right corner is where the magic happens, that’s where we both respect and love a brand and they become Lovemarks. iPhone, Aston Martin and anything endorsed by Kylie Minogue are in this category. Not joking, Kylie Minogue has been one of the strongest Lovemarks ever.

 

Now, let us get to the equations. Let us say that a company is buying a service, a product or a solution from another company. We’ll introduce the following variables:



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Before we try to put all this into a meaningful equation, we need to consider how business decisions are being made. There are basically two classes of acquisitions, private deals and public tenders. At the extreme ends of the scale we will find deals that are done over a dinner table between business associates and where the governing phrase is “we’ll find out of the details later” and public tenders where minimum specifications must be satisfied, and price is the only decision parameter. In the latter, however, there has almost always been a pre-qualification process where branding most probably has been a factor. In conclusion, there are probably no business deals where emotional attachment does not play any role at all.

 

A rational buyer will try to maximise the gain from any transaction, i.e. the difference between perceived value and perceived cost. With reference to the above table and below figure, the buyer will thus try to maximise Kp.

 

Kp = Vp – Cp = Vr + Ve – P – Cx 




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In his calculations, the buyer will use the price P as a starting point.Depending on the philosophy and policies of his company, he may or may not add externalities, Cx, like environmental impact or other effects on third parties as a cost element, either as a monetary term or in some kind of points evaluation.

In some cases, the buyer even asks the supplier to monetize the environmental impact of a solution by adding carbon cost to his price. He will then finally add a risk element as a cost, again either monetized or using evaluation points,Cy. And here comes the first element of brand value. With reference to the Lovemarks illustration above, the Respect brand value component addresses exactly the risk element

Documentable quality in e.g. terms om warranty cost, recognition in terms of customer base and references, achievements in terms of awards, positive press etc, all contribute to reduce the perceived risk and thus Cy. This is very well understood, and companies strive to work on this parameter as their most important brand effort. However, the effect of the emotional value component, Ve, is less understood and utilized by many companies.

When somebody says, “I have a negotiation meeting with IBM,” I am tempted to ask how it is possible to have a meeting with 380,000 people. The meeting is not with IBM, it is with a selection of IBM employees that come into the meeting loaded with company policies, guidelines, regulations and rules for how a negotiation with IBM should be carried out. Still, these are people and they do have emotions, even if they most probably try to hide them behind corporate jargon and behaviour.

And if this is not IBM but a medium sized or small national or local company, corporate jargon and behaviour may become less and less evident. In buying decisions, emotional value is often rationalized by e.g. claiming a lower risk element cost, Cy . “We believe they are more experienced than the competition” could mean “We like them better”. “They seem better qualified” could mean “They make me feel better”.

A conscious effort to understand how emotional value can contribute to your company’s brand strength, may bring you surprises. If you are a small company in competition with a large corporation, you may of course try to compete with them on the Respect scale but perhaps the most effective is to focus on the Love scale. What elements can you utilize that the large corporation cannot?

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When you are fighting companies with much larger resources, longer history and a huge track record, you are in an uphill battle on the Respect scale, no doubt about it. Why don’t you ask yourself what is less limitless – Respect or Love? What can you do along the Love scale that increases the emotional value your customer attributes to your brand? How can you make sure that the customer’s perceived gain with your solution is the winning one? What does it take for a customer to go from the rational choice of a bigger and presumably safer company to yours?

In this article, I have tried to show how the emotional elements of brand building can contribute to increase the customer’s perceived gain by choosing your offering. Although this is very well understood and utilized in consumer marketing, the effects in BtB markets may be less appreciated.

I have personally carried out branding projects in several companies where a major element has been the activation of the Love scale in the brand. In all cases, this has given exclusively positive effects and, in some cases, has contributed to significant increase in value for the company in question. Why don’t you try it yourself?

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