About 10 years ago, I was in a meeting with the president of a prominent New York community bank and he said to me, “When I drive down Park Avenue in Manhattan and I see a blue color gradation, I know instantly there is a Citibank branch under the blue color. I want people to feel the same when they see my color and logo.”
You can make the same analogy when you see yellow golden arches or a green circle with a twin-tailed mermaid. No, your hedge fund will never be the next McDonalds or the next Starbucks. However, building a brand is incredibly important for your financial services firm.
A strong brand instills confidence. Consider this: if you were to pitch a no-frills fund against a fund that invested in a clean, strong, confident logo, you would lose. Of course the performance, investment strategy and fund manager are all factors, but with all things being equal, an investor will select the better-branded fund.
A strong brand can increase awareness and interest in an organization. Think of a box of spaghetti. A supermarket brand has a plain white no-frills box and costs $.99. The blue box of Ronzoni costs $1.29. Spaghetti is spaghetti, yet the branded blue box of Ronzoni gets $.30 more just because it looks better, is advertised and is well branded. Your brand will do the same. If you are sending out your PowerPoint deck to a perspective qualities investor, you will be judged by how you look. You may have the same content on the inside, but your image is everything.
To take the supermarket analogy one step further, in any supermarket there is a premium put on anything that is on an end cap. Why is that? It’s all about positioning. Now think about how you can position your firm. Do you want to be on an end cap or lost in the mix with the other products? The small investment in your brand can be a huge benefit to your fund.
Branding for your fund does not have to cost hundreds of thousands of dollars. If you plan correctly, it can be cost-effective and incredibly beneficial.