The Importance of Brand Perception For Business Growth

For every business, success hinges on how the brand is perceived in the minds of consumers.

This intangible yet crucial aspect of business – brand perception – can make or break a company’s fortunes. From Apple’s sleek innovation to the magic of Disney, strong brand perceptions drive customer loyalty, command premium prices, and ultimately boost profitability. But what exactly is brand perception, why is it so important, and how can companies shape it to their advantage?

In this comprehensive guide, we’ll explore the nuances of brand perception, its impact on business success, and strategies for understanding and improving how your brand is viewed in the marketplace. We’ll also look at real-world examples of companies that have successfully transformed their brand image – and one cautionary tale of how quickly a strong brand can unravel.

What is Brand Perception?

Before we dive into defining Brand Perception, we need to take a step back and explain what we mean by a ‘brand’, rather than a company or business.

What is a Brand?

Best-selling author and marketing guru Seth Godin describes a brand as “the set of expectations, memories, stories that, taken together, account for a consumer’s decision to choose one product or service over another”.

A brand can also be explained as a mental concept that allows us to easily differentiate one company from another. It would be inefficient for us to have to constantly weigh our options every time we made a purchase decision, and brand awareness allows us to simplify the process of evaluating the comparative merits of a product or service.

A ‘brand’ encompasses various factors:

Identity

Logo, Typography Color
Palette & Tone of Voice

Personality

Behavior &
Communication

Promise

Intended Benefits
& Experiences

Positioning

USPs &
Differentiation

Culture

Internal Environment
& Employee Behavior

Values

Principles
& Beliefs

What is Brand Perception?

Brand perception, also known as brand reputation, is essentially the picture that a consumer forms in their mind when they think of a brand. It is the overall impression, opinion and feelings consumers have about a company, which can be seen as the cumulative effect of every interaction a person has with a business. Among other factors, this includes advertisements, word-of-mouth instances, customer service interactions, and experiences of using the products.

Crucially, brand perception is what people think about a brand,
not what the brand says about itself.

Brand reputations and perceptions have to be carefully cultivated over time. As Elizabeth Arden once noted, “Repetition makes reputation, and reputation makes customers”. This long-term consistency in product design, brand positioning, and communication strategies is what makes us associate Chanel with effortless French chic, Apple with creative youth culture, or Disney with childlike wonder.

It’s important to note here that brand perceptions can vary according to culture. For example, McDonald’s is seen as a quick and affordable meal option in many countries, but has become a symbol of aggressive global capitalism and American cultural imperialism in others.

What is Brand Equity?

Brand equity is the measure of the perceived worth of a brand, based on consumers’ perception of its quality and desirability. In basic terms, it is the value of the brand’s reputation, which research for the World Economic Forums claims accounts for 25% of a company’s total market value.

To give a smaller-scale example, if you wanted to buy a local gardening business which had built up an excellent reputation among their client base, a monetary value for that ‘goodwill’ would be priced into the total amount that you would be expected to pay for that business.

Why Is Brand Perception Important?

Brand perception is important for a number of reasons, but central is the significant influence it has on the likelihood of purchase. Worldwide, 87% of consumers say they take brand reputation into account when making purchase decisions.

How likely or unlikely are you to take brand reputation
into account when purchasing a product or service?

Brand perception goes beyond just product quality—it shapes consumer trust, marketing effectiveness, and ultimately impacts profitability in a number of ways:

Trust and Recognition: Recognizable brands attract more customers because people tend to trust what they know. This familiarity can be a powerful driver of consumer choice.
Marketing Efficiency: A good reputation generates greater marketing efficiency. Consumers are more likely to notice, believe, and act on advertising from companies they trust. This increased receptivity can lead to higher conversion rates and lower marketing costs.
Premium Pricing: Strong, positive brand perception often allows companies to command premium prices. Customers are often willing to pay more for products or services from brands they trust and admire.
Social Responsibility: Modern consumers expect more from companies than just quality products or services. They want to know what a company stands for beyond its share value. Brands need to demonstrate their commitment to wider societal or environmental causes.
Customer Experience: According to PWC, 86% of customers are willing to pay more for a better experience, and a positive brand perception often correlates with expectations of superior customer service and overall experience.

How to Understand Brand Perception

There can be a significant gap between how company leaders view their brand and how the public actually perceives it. While managers might have a clear vision of what they want their brand to represent, this can sometimes reflect aspirations rather than reality. To bridge this gap and make effective, lasting improvements, it’s crucial for companies to actively seek out and understand their customers’ true perceptions, and there are a number of ways businesses can improve their understanding.

Social Listening

Social Listening involves monitoring social media platforms, forums, and other online spaces where customers discuss a brand. By tracking these conversations, companies can gain real-time insights into customer sentiments, emerging trends and potential issues. This helps identify how the brand is perceived in various online communities and enables companies to respond quickly to both positive and negative feedback.

Brand Perception Surveys

Surveys are direct tools for gathering customer opinions about a brand, and can measure aspects such as brand awareness, loyalty, and the emotional connection customers feel to a company. The data produced by surveys can provide insights into how well messaging and brand values resonate with a target audience.

Competitor Analysis

Competitor Analysis helps companies understand their position in the market relative to their competitors. By evaluating competitors’ strengths and weaknesses, companies can identify gaps in their own brand perception and opportunities to differentiate themselves. This analysis also helps companies understand how their brand is perceived in a broader market context and what strategies can be implemented to improve their standing.

Conduct Focus Groups

Focus groups allow companies to gather in-depth qualitative insights from a selected group of consumers. Through guided discussions, companies can explore specific aspects of their brand perception, such as product experiences, advertising effectiveness, and overall brand image. This method provides detailed feedback that can reveal underlying reasons behind customer attitudes and behaviors.

Consumer Intelligence Research

Consumer intelligence research combines data analytics, market research, and behavioral insights to paint a comprehensive picture of consumer behavior and preferences. By understanding the broader consumer landscape, companies can identify trends and shifts in brand perception. This research helps companies adapt their strategies to meet evolving consumer expectations and maintain a positive brand image.

How To Improve Brand Perception

Enhancing your brand perception is a multifaceted process that requires a strategic approach and consistent effort. Here are five key strategies that can help you shape a more positive brand image:

01 Design a strong brand experience 02 Foster brand advocacy 03 Engage with complaints 04 Give yourself a makeover 05 Revisit the ‘4 Ps’

Design a strong brand experience

Creating a strong, consistent brand experience is fundamental to shaping positive brand perception. This encompasses every interaction a customer has with your brand, from their first awareness to post-purchase support.
Develop a Clear Brand Identity: Define your brand's core values, personality, and unique selling proposition. For example, Patagonia's brand identity revolves around environmental sustainability and outdoor adventure.
Ensure Consistency Across Touchpoints: Maintain a cohesive look, feel, and message across all platforms and channels. This includes your website, social media, packaging, in-store experience, and customer service. Apple is renowned for its consistent minimalist aesthetic across all touchpoints.
Focus on Customer Journey: Map out and optimize every step of the customer's interaction with your brand. Consider using customer journey mapping tools such as UXPressia to identify pain points and opportunities for improvement.
Train Your Team: Ensure all employees understand and embody your brand values in their interactions with customers. Zappos is famous for its company culture that empowers employees to go above and beyond for its customers.
Personalize the Experience: Use data and technology to tailor the brand experience to individual customer preferences. Amazon's personalized product recommendations are a prime example of this.

Foster brand advocacy

Turn your satisfied customers into brand ambassadors. Word-of-mouth recommendations are often the most trusted form of advertising.
Create a Loyalty Program: Reward repeat customers and incentivize referrals. Sephora's Beauty Insider program is an excellent example of a tiered loyalty program that encourages repeat purchases and sharing.
Engage on Social Media: Encourage user-generated content and interact with customers on social platforms. GoPro's Instagram strategy, which heavily features user-generated content, is a good example of this approach.
Provide Exceptional Customer Service: Go above and beyond to delight your customers. Nordstrom is renowned for its customer service, with stories of extraordinary measures taken to satisfy customers becoming part of their brand lore.
Share Customer Success Stories: Highlight how your brand has positively impacted your customers' lives. Airbnb's community stories showcase how their service has benefited both hosts and guests.
Create a Community: Foster a sense of belonging among your customers. Harley-Davidson's HOG (Harley Owners Group) is a prime example of building a strong community around a brand.

Engage with complaints

How you handle complaints can significantly impact your brand perception. Viewing complaints as opportunities rather than nuisances can turn detractors into advocates.
Respond Promptly: Address complaints quickly to show that you value customer feedback. Aim to respond within hours, not days.
Be Empathetic: Show genuine concern for the customer's issue. Train your customer service team in emotional intelligence.
Offer Solutions: Provide practical resolutions to problems, not just apologies. Empower your frontline staff to make decisions that benefit the customer.
Follow Up: Check back with customers to ensure their issue was resolved satisfactorily. This shows you care about their ongoing satisfaction.
Learn and Improve: Use complaint data to identify recurring issues and improve your products or services. Tesla, for instance, uses customer feedback to continually improve its vehicles through software updates.

Give yourself a makeover

Sometimes, a brand refresh or complete rebranding can help shift public perception. This could involve updating visual elements, refining messaging, or even repositioning the brand in the market.
Assess Your Current Brand: Identify elements that may be outdated or misaligned with your desired perception. Conduct brand audits and gather customer feedback.
Research Your Audience: Understand what resonates with your target demographic. Use surveys, focus groups, and social listening to gather insights.
Update Visual Elements: Refresh your logo, color scheme, and overall design aesthetic if needed. Mastercard's 2019 logo update, which removed the wordmark, is a good example of modernizing while maintaining brand recognition.
Refine Your Messaging: Ensure your brand communication aligns with your desired perception and resonates with your audience. Old Spice's shift from "old man's cologne" to a young, vibrant brand is a classic example of successful messaging refinement.
Consider Repositioning: If necessary, adjust your brand's market position to better align with your target audience's needs and values. Gucci's revival under Alessandro Michele, which appealed to a younger, more diverse audience, is a prime example of successful repositioning.

Revisit the ‘4 Ps’

The classic marketing mix of Product, Price, Place, and Promotion should be regularly reviewed and adjusted to ensure they align with and reinforce the desired brand perception.
Product: Ensure your offerings meet or exceed customer expectations and align with your brand promise. Continuously innovate and improve based on customer feedback and market trends. Apple's continuous product innovation is a prime example of this approach.
Price: Your pricing strategy should reflect your brand positioning. Premium brands can command higher prices, while value brands need to remain competitive. Luxury brands like Rolex use high prices to reinforce their premium positioning.
Place: Consider where and how your products are distributed. The channels you use can significantly impact brand perception. For example, luxury brands often limit their distribution to maintain exclusivity.
Promotion: Align your marketing and advertising efforts with your desired brand image. Ensure all promotional activities reinforce your brand values and positioning. Red Bull's extreme sports sponsorships and events align perfectly with their brand image of energy and excitement.

Interested in learning how Customer Intelligence Research can help you improve your Brand Perception? Contact us today

Brands Which Successfully Changed Their Perception

Volvo

It is something of a modern marketing miracle that a range of Volvo cars is now considered ‘cool’. Polestar was originally an aftermarket tuning company, the Swedish auto manufacturer brought it in-house in 2015 to produce the high-powered S60/V60 line, before using its name for a joint venture set up in 2017 with Geely Holdings to produce electric vehicles. Where Volvos have long had a reputation for producing safe but uninspiring cars, this fresh start allowed for new branding, messaging and storytelling, with the Polestar positioned as a cutting edge eco-friendly automobile.

Old Spice

Although very much a recognizable men’s fragrance brand, in the late 1990s and early 2000s Old Spice had garnered the unwanted reputation of being the aftershave of choice for the older generation. Unsurprisingly, it was unpopular with young men, who had no real desire to smell like their grandad. The brand successfully refreshed its image for a younger audience with a new social media and advertising strategy featuring American Football star Isaiah Mustafa – dubbed ‘The Man Your Man Could Smell Like’. Within just six months of the campaign’s launch, Old Spice saw a 27% boost in sales.

Barbie

As societal attitudes shifted towards more inclusive body image standards and female empowerment, the Barbie brand found itself at odds with contemporary values. Recognizing the need for change, Mattel embarked on a bold reinvention strategy. A key component of this effort was collaborating on a feature film that offered an affectionate yet self-reflective look at the Barbie universe, embracing both its iconic status and more eccentric offerings.
The resulting movie, directed by Greta Gerwig, proved to be a masterstroke. ‘Barbie’ not only dominated the box office, amassing $1.4 billion in global ticket sales and claiming the title of highest-grossing film of the year, but also reignited interest in the toy line. This renewed relevance translated into tangible results, with Barbie doll sales surging 16% in the third quarter of 2023.
As Chief Brand Officer Lisa Knight reflected, the movie also gave Mattel the confidence to take more risks in their advertising: “By being self-aware and by being in on some of the jokes, it made Mattel look confident and self-assured and, as a result, we’ve now engaged this creative community that wants to do more with us.”

H&M

H&M has undergone a significant brand repositioning to prioritize sustainability and distance itself from the challenge of budget-focused online retailer Shein. Although still synonymous with fast fashion, the retailer has made substantial efforts to enhance its environmental and social image. By committing to ambitious goals, such as using 100% recycled or sustainably sourced materials, and implementing recycling programs, H&M has attempted to demonstrate its dedication to a greener future.

Veolia

While B2B transactions are often viewed as less emotionally driven than B2C, Veolia’s brand refresh demonstrated that B2B marketing can effectively appeal to personal values. By incorporating nature photography (tied to their Wildlife Photographer of the Year sponsorship) and highlighting recycling initiatives, Veolia successfully tapped into customers’ sense of environmental responsibility, proving that emotional resonance has a place in B2B sales strategies.

And One Brand That Unsuccessfully Changed Its Perception

The value of brand reputation is arguably more visible when things go wrong. In the 1980s, Ratners Group turned their struggling jewelers around through clever market positioning, using pricing strategy to target an underserved working class demographic. Where the average cost of jewelry items was around £300 at the time, prices at Ratners were pitched around the £20 mark. The strategy paid off and by 1990 the group had captured 50% of the UK jewelry market.
This all changed in April 1991. During a speech to the Institute of Directors Annual Convention, owner Gerald Ratner risked two self-deprecating jokes about the company’s products:
“People say, ‘How can you sell this for such a low price?’ I say, because it’s total crap!”
“We even sell a pair of earrings for under £1. Some people say, ‘That’s cheaper than a prawn sandwich!’…I have to say, the sandwich will probably last longer than the earrings.”
The humorous asides were reported in the UK press, and, unfortunately for the company, tapped into wider suspicions about the quality of the products on offer at Ratners. The reputational fallout saw shares in the group lose 80% of their value over the following eight months. A year later, Gerald Ratner walked away from his family’s company with nothing.

Final Thoughts

Brand perception goes far beyond mere product quality or marketing efforts; it encompasses every touchpoint a customer has with your brand, from initial awareness to post-purchase interactions.
To thrive in an increasingly competitive marketplace, businesses must prioritize understanding and actively shaping their brand perception. This involves consistent effort across multiple fronts: creating strong brand experiences, fostering brand advocacy, effectively handling complaints, refreshing brand elements when necessary, and continually reassessing the fundamental aspects of your marketing mix.
By investing in these areas and remaining attuned to shifting consumer sentiments, companies can build a positive, resilient brand perception that not only drives customer loyalty and sales but also provides a buffer against potential challenges. It is always worth bearing in mind that your brand is not just what you say about yourself—it’s what your customers say about you when you’re not in the room.
Customer Intelligence Research from SEC provides crucial insights into brand perception and consumer feedback. We assist businesses in evaluating the consistency of their customer experience, analyzing the effectiveness of their brand messaging, and measuring the impact of their marketing initiatives and promotions. By leveraging these services, companies can develop a deeper understanding of their market position and make informed, data-driven decisions to enhance their performance and better meet customer needs.

Customer Service

Staff Attentiveness

How quickly are customers seen?

How long are customers left waiting?

Are staff actively listening to requests and concerns?

Are staff approachable and engaged?

Staff Appearance

Are all staff appropriately dressed?

Are staff in uniform?

Are staff well-groomed?

Does staff attire align with dress code policies?

Ethical Sales Practices

Are sales techniques high pressure?

Is the information transparent?

Are salespeople focusing on the needs of the customer rather than their own commission?

Complaint Handling

Are customer concerns handled in an understanding way?

How quickly are the support team able to find a resolution?

Was the resolution appropriate for the complaint?

Are staff empathetic?

Are follow-ups carried out?

Upselling and Cross-Selling

Are additional products and services offered?

Are they appropriate for the interaction?

How forcefully are these add-ons sold?

Are the benefits clearly articulated?

Employee Engagement

Employee Satisfaction levels

Are the employees happy in their work?

Do staff appear engaged during customer interactions?

Do they see their longer-term career in the company?

Employee Knowledge

Are staff knowledgeable about the products they are selling?

Are they able to provide suitable recommendations?

Are staff aware of current promotions?

Company Values

Are staff aware of the brand identity?

Can staff identify company values?

Are interactions in keeping with the brand personality?

Standards

Restrooms

Are the restrooms clean?

Has the cleaning log been updated?

Do the toilets flush properly?

Are the sinks functional?

Is there toilet paper and soap available?

Are there any signs of damage?

Appearance and Environment

Are promotional materials displayed?

Are they placed in appropriate positions?

What are the levels of upkeep and maintenance?

Are customer-facing areas clean?

Stock Availability

Are advertised products on display?

Is there a range of sizes available?

Are plus-sizes catered for?

How effectively do staff handle stock availability enquiries?

Are there any stock outs?

Pricing

Are prices consistent across locations?

Have price reductions been carried out?

Are prices as advertised online?

Brand Identity

Staff interactions

Is the way staff interact with customers in keeping with brand personality?

Are interactions using the same brand voice on all channels?

Are interactions coherent across all touchpoints?

Atmosphere

Is the lighting appropriate?

Is the temperature of the store suitable for the target audience?

Does the music genre fit with the brand identity?

Is the volume too quiet or too loud?

Imagery

Does the imagery match brand guidelines?

Is it up to date?

Is the color scheme appropriate for the business?

Is the employee dress code in keeping with the brand identity?

Compliance

Legal

Are ID checks carried out for age-restricted products?

Are background checks conducted for firearms sales?

Are financing options fully explained?

Is there access for disabled customers?

Do staff follow customer privacy procedures correctly?

Franchise

Are franchise guidelines being adhered to?

Are promotions consistent across locations?

Are customer service standards being upheld?

Does the presentation align with visual guidelines?

Recruitment

Is anti-discrimination legislation being adhered to?

Does the job advertisement accurately reflect the actual role and responsibilities?

Are the interviews conducted in a professional manner?

Are the interview questions appropriate for the role?

Health and safety

Are aisles clear of obstacles?

Are there any trip hazards?

Are emergency exits clearly marked and unobstructed?

Are employees using the correct protective clothing?

Are appropriate warning signs on display?

Business Intelligence

Competitor Research

How do customer satisfaction levels compare to your rivals?

What is your position within the marketplace?

Are there developments or innovations in the sector that your competitors are utilizing and you aren’t?

Customer Intelligence Research

Are the products or services meeting the needs of your target market?

How do customers perceive your brand?

What values do they associate with your brand?

Arcadio Roselli
CEO & Managing Director of Service Evaluation Concepts. Dedicated to driving brand experience forward with the tools that ensure the reality in the the customer corridor is aligned with the promoted brand value proposition.

The Importance of Brand Perception

The Importance of Brand Perception