Why Brand Authenticity is Good for Business
One thing is certain in marketing: businesses with a strong brand know who their customer is and has a clear and distinct identity that their customers care about. This helps the business to stand out in the marketplace, and create an emotional connection with its customers that motivates them to purchase its products or services. Brands are an essential part of any business – they set the expectation, the experience with the product or service and communicate the company's core values and mission. And a successful brand not only helps to attract customers but also influences their loyalty.
Authenticity is at the very core of a strong brand. By effectively communicating core values and missions and staying true to them in public, brands can establish trust with consumers, differentiate themselves from their competitors, and support long-term business success. Essentially, authentic communication builds trust in how products and services will function and puts the company in a more trusted position if the need for change communication or crisis communication occurs. Being authentic also means being transparent and accountable for one's actions, which is especially important in today's socially conscious and competitive business environment.
Top 5 Building Blocks of Authentic Communication
Trust
Authenticity helps to establish trust with consumers. When a brand is genuine and transparent, it is more likely to be viewed as trustworthy.
Relatability
Authentic brands are relatable and resonate with consumers on a personal level. This makes them more appealing and increases brand loyalty.
Transparency
Consumers value transparency in brands, and authenticity helps to build this trust by being open and honest with their audience.
Social Consciousness
Today's consumers are increasingly socially and environmentally aware, and they want to align themselves with brands that share their values. Authenticity in a brand helps consumers to trust that a company is operating in an ethical and responsible manner.
Consistency
Authenticity also means that a brand stays true to its values, mission, and message. This helps to create consistency and predictability for consumers, which is important for building brand loyalty.
The Value of Brand Loyalty
Brand loyalty leads to repeat purchases and positive word-of-mouth marketing. When customers are loyal to a brand, they are more likely to spend more per transaction, make purchases more frequently, continue doing business with that brand over time, which leads to increased revenue for the company. Loyal customers are also more likely to recommend a brand to others, which can lead to new customers and even more revenue.
It is always more expensive to acquire new customers than to retain existing ones. That’s one reason why loyal customers also tend to be more profitable for a business, Additionally, they are less price-sensitive and more willing to pay a premium for a brand they trust. This is because they often have a strong emotional connection to the brand and its values. They may also more forgiving with product or service issues, once there is communication about the issues to manage their expectations. Moreover, loyal customers are also more likely to provide valuable feedback and insights, which can help to improve the overall customer experience and drive innovation. This can help to increase customer lifetime value by attracting new customers and retaining existing ones.
Strong Brands Matter in Competitive Markets
Strong brands are successful brands. There is a solid business case for why businesses should invest the necessary time and resources in developing clear and authentic brand communication if it wants to build customer loyalty and grow long-term business.
Competitive Advantage
A strong brand can give a business a competitive advantage in the marketplace. It can differentiate a business from its competitors and make it more attractive to customers.
Increased Revenue
A strong brand can lead to increased revenue by building customer loyalty, which leads to repeat purchases and positive word-of-mouth marketing.
Higher Profitability
Strong brands can command higher prices and generate higher profit margins. This is because customers are willing to pay a premium for a brand they trust and have an emotional connection with.
Brand Equity
Investing in a strong brand can help to build brand equity, which is the value that a brand adds to a product or service. This can lead to increased value for the business and make it more attractive to potential investors.
Crisis Management
Strong brands are often more resilient in the face of a crisis. A strong brand reputation, built on trust and authenticity, can help a business weather a crisis, and even come out stronger on the other side.
Attracting and Retaining Top Talent
A strong brand can also attract and retain top talent, as it can be a valuable aspect for employees to identify with the company, its culture and its mission. In the same way that a brand can resonate with its ideal customers, it should also resonate with its ideal employees, making it easier to attract workers who are passionate, dedicated and loyal.
Patagonia — a strong brand committed to strong values
Patagonia, a 50-year-old American company that manufactures and sells high-quality outdoor clothing, is a brand that has repeatedly demonstrated its commitment to upholding its core values, which include protecting the environment and promoting social responsibility. The company earns over $1 billion in annual revenue, due in part to positioning itself as a sustainable brand. Patagonia creates outdoor clothing and gear that is durable and sustainably produced, using only recycled materials in its products whenever possible. The company also works hard to minimize its environmental impact, from reducing waste in production to donating one percent of sales to environmental causes.
Patagonia’s commitment to sustainability extends beyond the product development process—it permeates all aspects of the business. From taking steps to reduce energy consumption at headquarters and switching to solar power, to creating community grants for local environmental initiatives, to the headline-making decision of its founder last year to donate ownership of the company to a non-profit organization dedicated to fighting climate change, Patagonia demonstrates that it is more than a profitable business, but also an authentic and passionate supporter of sustainable living.
Patagonia has also shown its dedication to creating a culture of social responsibility. The company provides generous wages, benefits, and vacation days for its employees and also invests in creative initiatives, such as developing job training programs in local communities. Patagonia also encourages customers to repair their products instead of buying new ones whenever possible, valuing timelessness and sustainability over profiting from fast-consumption trends.
Patagonia’s commitment to authenticity and sustainability makes it stand out from other brands and has earned it devoted followers who are loyal not just to the company, but to the values that it stands for. Ultimately, Patagonia has become a beacon of what it means to be an authentic and responsible business.
Patagonia’s success isn't just good news for the company — it's also great news for all businesses striving toward greater sustainability and social responsibility. Patagonia is an example of how a business can be profitable and still remain true to its core beliefs and ideals. And it’s clear how in many cases those goals can be deeply intertwined, feeding off of each other for the betterment of both the business and the broader community.