Performance, success aren’t down to being quiet; you have to brag: David Haigh

As part of the IAA Masterclass series, David Haigh, chairman, Brand Finance Institute, spoke about the importance of brands and why organisations must bridge the gap between marketing and finance. 

 

The session was moderated by Dagmara Szulce, managing director, IAA.

 

He began his talk by stating a mission: to bridge the finance-marketing gap, something that is yet to be entirely accomplished.

 

He said, "A lot of marketing people take a keen interest in finance and vice-versa. We, as a brand, have always tried to systematise what we do. The finance profession wasn’t taking branding seriously. After working with many financial institutes, we have been able to achieve this today."

 

According to Haigh, brands appeal to all stakeholders.

 

"Employees, talent and suppliers have a direct impact on the working of the business. Partners, debt providers and investors are the ones who give the wherewithal to operate, whereas the media and the government give it the license. Customers and trade channels too are extremely important. However, all of them have to be managed for value."

 

Speaking about the nature of brands today, Haigh strongly believes that brands that have a better record on sustainability are more desirable. Citing examples from the pharma space to support this, he spoke of companies like Pfizer and Johnson & Johnson – brands that increased people's willingness to get inoculated thanks to the assumption that they're more effective when compared to companies like Sputnik.

 

Explaining the role of brands in society, he stated that diversity is the top agenda for them today. He explained, "Brand need to have a diverse culture and endorse all sorts of minorities genuinely. Many have embraced this and made a big difference to their operating culture." 

 

Similarly, from the business perspective, Haigh opines that companies with strong branding are more resilient in economic situations and recover faster after economic shocks.

 

Talking about why brands matter to investors, he said, "Companies that have got strong brands perform better in stock markets, with lower stock market volatility and higher returns. However, above all, in times of crisis, they become a safe haven for capital and people will invest in it."

 

He also provided examples of why brands matter to the government, in finance, and their overall value in businesses. "Finance people realise that businesses are of long-term value, even post the Covid-19 crisis. Brands like Apple and Amazon are booming and many others have done extremely well."

 

Speaking about how the pandemic has led marketers to cut down on their advertising budgets, he said, “The message out there is that cutting advertising is not a good thing. You need to build up the store of brand equity. It’s not all about sales activation and finance people are understanding that.”

 

Haigh stated the importance of brand valuation and evaluation in tying marketing and finance together. “Finance looks at efficiency, whereas marketing looks beyond that, to cater to the customers, stakeholders and how that translates into sales, trust, etc.”

 

When asked in a Q&A session about what customers ultimately want, Haigh was confident that being determinedly better in your space is what does the trick. He said, “TikTok was better than its competitors and so was Facebook. You can do with social media and PR, but in the end, you need to resort to advertising. All brands need to have genuineness, tolerance, inclusivity and most of the new brands coming through have these table stakes.”

 

Speaking about the FMCG sector, in particular, he said that the total marketing budget should be at 15-20% of turnover, which according to him, is a scary number. “It's like drinking advertising. Within that, at least half should be brand-building and the other half should be promotion, with lesser spends on PR and relationship building. We started with FMCG companies and now have more brands in the mining, chemical and banking space. These have realised that performance and success are not down to being the quiet guys; you have to brag about it and get your share of the demand.”

 

On the future of advertising, he stated that it was key to many brands which are now moving back towards more image-related, brand-equity advertising building.

 

Haigh ended the session with a Henry Ford quote that said, “A man who stops advertising to save money is like a man who stops the clock to save time.”