Branding a service in the age of entrepreneurship and industrialisation
As once said by Elon Musk “Brand is just a perception, and perception will match reality over time”. This is true especially when our customers evaluate the service we offer them and come up with a story about our brand in the age of entrepreneurship. Of course not all entrepreneurs are in the business of marketing and selling tangible products. There is another side of production where branding matters too. That is service marketing where we try to make the invisible seen and be touched through an effective brand management. This I refer to as the magic of brands in the age of entrepreneurship ( making the intangible tangible). Here there should be a paradigm shift through inviting branding strategies that are rewired to move from product representation to service orientation. Some will say it’s usually easier said than done. Yes, especially when trying to make the markets believe and see something that cannot be touched (spiritual branding). It is in this effort that real brands should then go beyond the traditional and be able to convince the market that a service can be seen and evaluated (for a best market value with satisfaction guaranteed in all aspects). In this edition we focus on branding of a service by our SMEs. In our enterprising world sometimes we are selling our knowledge, expertise, vision, promises and even doing consultancy as a service to a broader market (time to relook and retool). The question that triggered the discussion is on how to turn a service into an attractive brand.
The benchmark of international bond markets, the US 10 Year, has had its steepest correction in history, with yields up almost 1,3% (bond yields move inversely to prices) to almost 3%.
These are all astonishing moves and have made 2022 one of the toughest years for investors since the financial crisis. But one comparative backwater of international finance has remained blissfully calm and unaware, until now: South Africa.
Until mid-April, South African market commentators were spending their time trying to work out why domestic markets had been so comparatively unaffected. The JSE Top 40 index was flat, buoyed by commodity producers and resilient financials. The rand had been atypically resilient, trading below R14.50 to the greenback. And South African government bonds were almost unchanged from levels at the beginning of the year, with the 10year comfortably under 10%.
In the past two weeks, all this has unravelled. As ever with markets, irrationality can persist for a period of time but the reckonings, when they inevitably come, are always more violent than one could have imagined.
The key protagonist of these fluctuations of South African capital markets is the Federal Reserve in Washington, DC. Although a number of domestic factors have been cited for this recent tectonic shift, and indeed recent occurrences such as the disastrous flooding in KwaZuluNatal and Eskom load-shedding have acted as catalysts, these domestic factors have only served as a final excuse for investors to sell and markets to rerate to more realistic levels.
In the previous editions we have looked at various brand elements as leading representatives of our businesses and offerings on the global market. We can now infuse these elements in our service provision to determine how they also escalate recognition, lasting visibility, identity and differentiation on the market. We start by looking at the intangible nature of a service. The intangibility of a service makes it difficult to package, stamp a logo and using colour(s) on a service. However, it is imperative to come up with specific brand elements which can stimulate imagination and sometimes a fantasy in the mind of the customer. Nelson Mandela once said that “The power of imagination created the illusion that my vision went much farther that the naked eye could actually see”. That’s what brand elements for a service should do. In this case our entrepreneurs should consider the use of jingles/songs, advertisements through animations and supporting taglines that connect with the mind and spirit/soul of the customer like! “Inspired to change you world” In their consumption of a service the customers can then be easily reminded and develop an imagination from these elements as attached to their memory. Another critical characteristic of a service is being inseparable from the provider/entrepreneur. An entrepreneur cannot be separated from his/her service. This
Like a distant underwater earthquake, the ensuing tsunami is only hitting South Africa now. There is no need to make it any more complicated than it needs to be. Markets have had a bad few weeks, months, year — because the Fed is becoming increasingly hawkish on inflation.
This Volckerian double punch — simultaneously aggressively hiking rates and selling bonds on its balance sheet — is having a lethal effect on almost all asset classes, from bonds to equities to property. means the entrepreneur together with other members of the business are the brand(s) for that service they are providing. What the markets see in a person who is running an enterprise or a representative becomes a brand reflection for that service. That is the reason why people have been considered as another special cog to add on to the service marketing mixes. The way you dress, talk, interact, share and associate contribute to your brand attractiveness in the service sector. That is the reason why effective and efficient customer care management matters most in the marketing of a service (human intervention through hospitality). The front office of your business and your sales representatives should reflect a top notch brand (one that is unbeatable and compared to none) in the way they deal and treat customers. Through word of mouth the customers will spread your supremacy/failure as they share experiences about your service. Yet most of the times we a caught wanting with owners and other members of our SMEs shouting at customers and treating customer care as any other business. No! We are losing ourselves and our customers in that way (brand terrorism). This then takes us to the processes that are involved in the selling of a service. They also contribute to positive brand visibility and attractiveness. Especially considering a balance between
The Fed is deflating asset prices by sucking vast quantities of liquidity out of markets while, at the same time, aggressively pulling up the economy’s handbrake.
The market is now pricing in a Fed that cares little for the screams of anguish coming from Wall Street. In contrast to the classic “Greenspan Put”, which referred to then Fed governor Alan Greenspan cutting rates and giving a fillip to asset prices whenever things wobbled, investors may have to start referencing the “Jay Powell Call”. techno and human intervention in the value chain. Sometimes we fail by relying more on robots/ artificial intelligence or humans in our service provision processes. There are some departments that have been publicly shamed and named for poor/slow/corrupt processes. When people refer to any shoddy processes they point out these departments. And this has become their label as ineffective and inefficient brands. Do not let your own service brand die by the same. As the adage goes; “forewarned is forearmed”. Let’s revisit our processes so that they represent and escalate a brand that the market will always refer to as a creation of novelty, friendly and reliable. One that the customers will not feel suffocated or made to cry when engaged. I will refer you to some expectations in our entrepreneurial processes as evaluated by our markets which include consistency, good timing, efficient, quality, friendly to all and even confidential. These will help strengthen our processes as done by us or with professional assistance from outside practitioners and consultants. Also services have been known to be heterogeneous. This does not match with some principles of an effective brand especially for a brand to be consistent in its meaning and promises. To bridge this gap there is need to come up with a solid branding checklist and do regular uniformity trainings of members of the organisation (supporting brand visioning). There should be a strong brand culture embedded in service delivery for consistence. Where customer care and response to the market requests will be equally the same from one
What the market still seems all too complacent about, however, are the effects of this unprecedented monetary tightening on the economy. Markets are indicating an economic slowdown is likely, but not a recession. US equity indices are still one-third above pre-pandemic levels, while corporate bond yields are tighter.
The JSE Top 40 is still more than 20% higher than pre-pandemic. The yield curve is flat, but not inverted and flashing red.
This is a potentially naïve assumption that may start to look wildly optimistic. In a recent paper, Alex Domash and Larry Summers found that there have been eight instances since 1955 where wage inflation was above 5% and the unemployment rate was below 4%, as they are now.
In all eight, a recession followed within two years. As the Fed is now finding, engineering a soft landing when the air break is yanked so hard and so late is very difficult. Usually, after suddenly stalling, the plane crashes. The Fed is now running the risk of doing exactly that to the global economy.
It is simply astonishing that after two years of (largely unwarranted) monetary policy largesse, organisational member to another (to be discussed in detailed in the coming editions). Lastly our entrepreneurs involved in service provision should be able to customise their offering from one customer to another as another crucial tactic to be known as a brand that serve specific needs of different groups. That is what engaging brands should do where everyone feels considered and take care of his/her personal needs. This is because a service is perishable and once given to one person it will be difficult to equally meet a next customer with the same needs/expectations for maximum satisfaction. I will leave you to remember these words by Tony Hsieh that “Your culture is your brand”. One cannot separate organisational culture and successful service branding towards industrialisation in the age of entrepreneurship. It’s high time our service should be tangible as inspired by and effective service brand management.
Dr Farai Chigora is a businessman and academic. He is the Head of Business Science at the Africa University’s College of Business, Peace, Leadership and Governance. His Doctoral Research focused on Business Administration (Destination Marketing and Branding Major, Ukzn, SA). He is into agribusiness and consults for many companies in Zimbabwe and Africa. He writes in his personal capacity and can be contacted for feedback and business at fariechigora@ gmail.com, WhatsApp mobile: +263772886871. the Fed has done a precise 180° Uturn in less than six months.
To call this rash would be far too kind; it is simply unprofessional and irresponsible — on a global scale. Many thought the years of the Fed discounting inflation, only to cripple the economy in a vainglorious attempt to catch up, were over. Sadly, they have been proved wrong. South Africans, as the past few weeks have proven, will come to experience the vicious effects of this recklessness and negligence first-hand.
A recession in the US will almost certainly mean recession — or at least protracted slowdown — in South Africa. History has proven that to be the case.
Those South Africans who have been hoping for a resurgence in fortunes following the devastating recessions of the Zuma years and the Covid-19 pandemic may well be disappointed.
Sadly, not only is the economy paying the price for inept and incapable policymakers at home, but it is also about to suffer from similar incompetence abroad, except in the form of maladroit US monetary policy. There is almost certainly more pain to be felt.
— Daily Maverick