How Do You Know When to use a Branding Agency for Your Business? [Get All The Details]

When is a branding agency the best choice, and when could an alternative save your business money?

Whether you’ve got a game-changing idea for a startup or you’ve built a new product that blows your competitors out of the water, I’ve got news for you: it’s not enough.

Without a strong wraparound brand, your business idea might not make it off the ground. Potential customers will forget about you faster than you can say “innovation”. They’ll lean on products and services that they feel a connection to, and place their trust in.

And branding won’t just help you survive, it’s the key to thriving. Research published in the Journal of Marketing found that firms with a strong brand portfolio achieve 9% higher revenue growth and have a 13% higher market value.

Meanwhile, TikTok has taken the tech world by storm with its focus on addictive quick-hit entertainment and a brand based on community contribution.

However, given that a branding agency’s full service could cost in the region of five figures, it’s unrealistic to expect every small business to take the plunge.

And in a fast-changing business landscape, where machine learning, online tools, and AI offer increasingly effective tools for brand management and social media gives businesses the power of unmediated communication with their audience, you might just be able to do more for less.

So, let’s look at the times when a branding agency will offer a great return on investment — and when you can get the same powerful results for less.

What is branding?

Even to those with years of experience in business, branding can sometimes seem like a dark art. It’s the visual and conceptual identity that wraps around your product or service, incorporating a huge number of elements. Of course, as it’s so complex, often definitions of branding end up being somewhat vague.

The American Marketing Association answers the question, “what is branding” with the following:  “a brand is a name, term, design, symbol or any other feature that identifies one seller’s goods or service as distinct from those of other sellers.” According to this, your brand is what makes you unique.

On a superficial level, the AMA is right: branding is about identifying the appropriate symbols to represent your business.

But on a deeper level, branding is the creation of a connection between your business identity and the people you’re talking to: customers, potential customers, and industry peers. Branding ranges from the name and logo of your business to the interior design in brick-and-mortar stores, the font you use on your website, the packaging you send orders out in, and much more.

The importance of branding decisions for business success is not in question: research has shown that brand alone accounts for 30% of the stock market value of companies in the S&P 500 Index. But given the often nebulous definitions of branding, it’s no wonder you might be considering outsourcing the hard work.

So, what is expected of a branding agency?

When used effectively, a branding agency will provide your business with a clear, coherent, and strategized branding package.

As well as identifying your brand tone and the best way to communicate your values with your customers, a branding agency will also outline the best marketing strategies for building brand equity — that is, the enhanced commercial value of your business, through branding.

Branding agencies offer a wide range of branding services, including:

• Brand Naming: Your business name is the fundamental signifier of your identity, and branding agencies can support you in this process. However, most branding agencies only name a handful of companies each year. It’s a thorough process, but not one that’s backed up by a volume of experience.
• Brand Identity Design and Brand Colors: Your logo and the associated visual elements of your brand are incredibly important in those first impressions you make on customers. Branding professionals can assist in choosing your branding colors, your typography, and the creation of a visual style guide to ensure a coherent cross-platform identity. But branding professionals aren’t only found at agencies!
• Brand Strategy: A branding agency can help you define your brand’s purpose, values, target audience, and competitive marketplace positioning. This will include the development of branding guidelines that ensure consistent communication across all channels.
• Social Media Management and Advertising Campaigns: Branding agencies can also mastermind your marketing campaigns across a range of platforms and manage your day-to-day social media to ensure messaging stays on point.
• Crisis Management: Some branding agencies are there for when it all goes wrong. Whether your product keeps exploding or an unflattering video of your CEO has gone viral, branding agencies can help you pivot to pick up the pieces.

If your product does this kind of thing, you might need a little (re)branding help…

Many of these same services are also offered by branding agency alternatives. Of course, if your business has failed its customers and taken a hit in trust and reliability, it might be time to call in the professionals. But while branding agencies provide experience and expertise, you know your business’s values and purpose better than anyone.

Two signs your business needs a branding agency

Here’s when it might be a good idea to splash out on a branding agency.

1. When You’re Experiencing Rapid Expansion

Rapid growth presents a huge opportunity and to capitalize on increased exposure and awareness, it can make sense to employ a branding agency You’ll have to scale up your marketing efforts commensurately, and in fast-moving, turbulent times a branding agency can offer a focussed and strategized way to do this.

Additionally, during times of rapid growth, it can be hard to hold onto your original identity. Airbnb experienced this problem: from starting out as an industry disruptor, they quickly became the very thing they sought to replace, and it damaged their brand. They opted to refocus operations on Airbnb Rooms — the “soul of Airbnb” — and a branding agency can help you maintain your brand identity through the challenges of growth.

2. When You Need Brand Revitalization

As of 2023, it’s easier than ever to ruffle the feathers of the consumer echo chamber. Social media has given everyone a voice that’s easily amplified, and when the tide turns against your branding decisions, you may need an expert opinion to navigate this new world.

In 2017, Pepsi’s ad featuring influencer Kylie Jenner handing a police officer a bottle of Pepsi sparked instant backlash. Pepsi doubled down, claiming the ad reflected an “important message”. But less than a day later, they pulled the ad and issued an apology. Fortunately for Pepsi, this quick turnaround and seemingly authentic apology enabled the brand to bounce back, but it’s clear that expert intervention was needed in those 24 hours.

When an alternative to a branding agency makes sense

In times of crisis, as well as those of rapid expansion, there are great risks and great rewards for your organization.

But when it’s business as usual, or when you’re starting a new business or launching a new product a branding agency can be an unnecessary expense, easily stretching into the tens of thousands of dollars for basic branding packages.

That’s why Squadhelp was launched: to overcome the limitations of traditional agencies and offer businesses an affordable alternative.

There are other options for naming and branding

When You’re in the Early Stages of Launching Your Business

In the early days of launching, and defining, your business, outsourcing the work of branding can hold you back. It pays at this stage to invest time in identifying your unique value proposition and the values that will make up your brand identity.

These are the essential first steps to take when considering the name of your business. Most branding agencies name just a handful of businesses a year, while Squadhelp has supported over 40,000 businesses find a successful name.

The work you put into understanding how your name, mission and brand intertwine will pay dividends when developing your own brand strategy down the road.

When you Have Budget Constraints

Budget constraints will inevitably limit your marketing efforts and it’s important to consider whether you can get a better ROI elsewhere. For example, hitting the right brand tone on social media, like the National Park Service did this year, can build a loyal following of customers at a fraction of the cost of a traditional agency intervention.

Affordable campaigns based on user-generated content and DIY video content can even emphasize the authenticity of your brand when connecting with your customers.

Social media offers a space for DIY brand building, but striking the right tone is key.

When you Have Industry-Specific Requirements

If your business operates in an unusual niche, a branding agency may not be able to meet the unique branding requirements of your industry. This is often the case for B2B services or industries with tight regulations around messaging and packaging as in pharmaceuticals.

Industry-specific agencies can offer branding solutions but they’re exceptionally expensive: leveraging online tools alongside your own industry expertise might be a better strategy. Trust your experience and utilize your network to create branding strategies that speak effectively to your audience.

Final thoughts

Branding agencies have a lot to offer, particularly when there’s a fine line between success and failure. If your business is experiencing rapid expansion, a branding agency can ensure your identity survives the change, and if you’re experiencing backlash because of your branding choices, then an outside perspective can be immensely valuable.

But no business should assume that a strong brand identity requires a branding agency and business leaders should take the time to understand the unique offering their business provides its customers and the fundamental values that connect you with your audience.

Whether you’re reaching out to a branding agency or not, building brand guidelines is a great way to find your mission. Branding then becomes the question of how you communicate this to your audience, and you can strike your own path.

Guest Author: Lotte Reford is Communications Lead for Squadhelp.com, an innovative naming & branding platform with more than 40,000 customers globally, from the smallest startups to corporations like Nestle, Philips, Hilton, and Pepsi.