Manage your brand: how are you different from the charity down the street?

Question:

What do the following companies have in common?

* Brooks Brothers and Casual Corner clothing stores

* Avis and Budget rental cars

* Pizza Hut and KFC restaurants

Answer:

All of these well-known brand names are subsidiary companies held by a parent corporation. The parent corporations are Retail Brand Alliance, Cendant, and YUM! Brands, respectively.

Notice the strength of these brand names. Unless you walk everywhere, make your own clothes, and never eat out you'll probably recognize most of these brand names.

Did you notice something else? From a consumer perspective, there is no reason why anyone other than Wall Street types would know the ultimate owners of these household name brands. Nor would they care about ownership, because those parent companies are in the management business, not the business of appealing to consumers. Given their choice, they'd probably stay firmly in the background with their consumer names pushed to the foreground.

Nonprofits have some of the strongest, most widely-recognized brands in the national consumer marketplace. From the United Way to the scouting organizations to the YMCA, nonprofit brands are as strong, if not stronger, in consumer recognition than many commercial brands.

But for every widely-recognized national brand there are literally thousands of well-known local brands in every geographic area. In fact, it can be said that virtually every nonprofit beyond the startup stage has some level of brand strength. That means that it has an asset that can be helpful in accomplishing its mission. So the real question is how one manages the brand.

Elements of a brand

A famous ad man named David Ogilvy famously defined a brand as "the intangible sum of a product's attributes: its name, packaging, and price, its history, its reputation, and the way it's advertised." Add two other important elements to the statement: an implicit promise about what one's experience with the brand will be like, and all the people and systems that go into ensuring that that experience are reliable.

A less well-recognized aspect of the brand experience for consumers is that a successful brand reduces the buyer's risk. This was expressed decades ago in corporate America when technology-purchasing executives would say "no one ever got fired for recommending IBM." Often today, that same corporate world seeks out a nonprofit partner for a marketing-related purpose--but only if that partner is squeaky-clean and unequivocally associated with acceptable values. The brand is the primary signal of those values.

Taking control

The care and feeding of a brand lies in the ability of the brand holder to deliver the same experience the next time, and that is how nonprofits can get control of their brand. Streetsmart managers know that the power of the brand lies in its ability to persuade funders, consumers, and other stakeholders that they will get the same top quality results each time they use the service, and that in the course of many uses there won't be any surprises.

Some managers think that values are the most important part of the brand experience, but that is only half of the equation. The other half of the equation is replicability.

Many nonprofits are not good at replicability, which is why they're not good at brand management. What they are good at is solving problems, often individual problems, in highly individual ways. This earns trust, but does not constitute a brand. When services consist of solving different problems in different ways one earns a good reputation. When services consist of solving the same problems in predictable ways, one has the makings of a brand.

In many areas where nonprofits are active there are no widely accepted ways of delivering services. In fact, many times this sector gets involved in an area precisely because there are no established ways of tackling the problem and there needs to be some good, thoughtful experimentation. This is exciting and personally rewarding for those involved, it just doesn't necessarily lead to good conditions for a brand name. Only when there is a well-established framework for providing services can a true brand name even have a chance to emerge.

Managing multiple brands

A growing number of nonprofits have a different problem: multiple brands. It is always easier when there is only one brand and it resides in the operating corporation, but many forces such as the fragmentation of funders and the needs of different populations can make it essential to have multiple brands. Multiple brands are also inevitable whenever a single organization without a strong centralizing brand provides a variety of small programs or services.

Any manager of a new program with enthusiasm and creativity is likely to come up with a name for the program. When the next program manager does the same, and then the next, their organization is on the road to a jumble of little brand names. As long as the scale of the programs remains small and the programs distinct enough the situation is manageable, but otherwise the organization will quickly develop an overload of brand names. If the programs are of any substantial size, their demands will likely become untenable.

A brand takes money, time, and resources to support. That's one of the reasons why for-profit brands are often acquired and managed by the kind of management companies described above. Streetsmart managers will try to minimize the numbers of brands an organization supports, if for no other reason than they don't have the kind of resources and scale that a multi-national company can command.

At the same time, there are advantages to programs having their own identity in a crowded marketplace. The most common way to resolve this problem is to have an organization-wide brand that appears in some way in every program's name. Another approach is simply to associate the program brand name with the organization's brand name wherever it appears, so that the program is always linked to the organization.

If a unified brand approach isn't possible, the organization runs the risk of brands that bump into each other, confuse consumers and possibly cannibalize each other's market. To see if your brands are separate enough, evaluate them according to the following four strategic factors. The greater the number of categories in which two brands are distinct from each other, the more you'll protect the brand name.

Additional issues

Geography. What geographic territory does each brand cover? Generally this is determined by the boundaries of the bulk of the users and potential users. Array this information on a map, if possible. If there is adequate separation between the brands, and if neither plans to move into common territory, geographic separation is a powerful protector of brand integrity.

Consumers. The demographics of the brand's consumers are a different kind of boundary. Age is one of the most important demographic indicators. If brands have distinctly different demographics--kids versus seniors, for example--they are highly unlikely to conflict.

Services. Service models are also a source of differentiation. This indicator tends to work in tandem with consumer demographics, but it also has a separate kind of power. Service models that appeal to some consumers won't work for others. This is one of the weaker sources of differentiation, but it grows much stronger in connection with one of the others, such as funders as described below.

Funders. Finally, funding sources themselves often maintain distance from each other when funding on the service level. For those managing the services this is a problem, but for managing the brand it can be of help. Programs that are traditionally government-funded are often unappealing to philanthropists, and vice versa, and philanthropic funding is increasingly targeted anyway.

Regard these strategic factors as axes of differentiation. The less overlap a brand has among these factors the easier it will be to maintain its integrity without confusion. Differentiation doesn't make it any easier or less expensive to support a brand, but it helps preserve each brand's separate strength.

Building a brand takes time and constant attention, and managing it takes even more. Managing multiple brands increases the nature of the task exponentially. But the power of a brand can be a nonprofit's biggest intangible asset, and is one of the ways that it helps shape our culture. Rental car companies and fast food outlets shouldn't be the only kinds of brands capable of doing that.

Thomas A. McLaughlin is a national nonprofit management consultant with Grant Thornton in Boston. He is the author of the book Nonprofit Strategic Positioning (John Wiley and Sons, 2006). His email address is [e-mail]