Chapter 9. Building a Brand

The Point: Establishing, building, and extending a brand, regardless of whether the brand in question is a traditional business or one linked to sports, requires ongoing, hands-on management and leadership at every turn. Brand building visionaries protect their brand at all costs, even if doing so requires micromanagement. A company's reputation and integrity with consumers takes years to develop but only minutes to undermine as evidenced throughout the sports world.

Finding a universally accepted definition of the word brand and the associated process known as branding has been about as hard as coming to a consensus among sports fans about the best team of all time. You can argue all you want about the great dynasties fielded by the Yankees, Boston Celtics, San Francisco 49ers, and Montreal Canadiens, but, like great sports teams, the notion of brands and branding has meant different things to different people.

Over the last decade, numerous academicians and practitioners have undertaken the daunting task of getting their hands around the increasingly important practice of branding. They have done so at a time when business has been moving at the speed of light. One day, bellwether brands are rock solid, the next day they are on the ropes, facing a federal investigation or hoping to avert bankruptcy following a freefall in their market capitalization.

Successful branding efforts attract attention to an organization and help paint the company's picture for the consumer, inspiring loyalty to the company's products and services in the process. Once branded, these well-positioned brands command a premium price among customers and increase shareholder value.

The inherent value of branding is often realized when analyzing the decision-making process of consumers, particularly when they are considering the merits of largely indistinguishable products. Chesebrough-Ponds, the maker of Q-tips, provides a compelling example of this marketing phenomenon. Despite the fact that competing products, such as the generic supermarket chain variety, are quite similar, many consumers prefer to pay a little extra for the Q-tip name and the quality the brand name implies.

Catchy or creative brand names and logos also contribute to brand value, especially for fledgling companies hoping to compete with larger, well-regarded brands. Karen and Kevin Push walked into Bad Ass Coffee Co., whose motto is "Coffee with an Attitude" in Kona, Hawaii, because they were initially amused by the name. Days later, the two bought the store and went on to become the company's first franchisees. Today there are about 20 Bad Ass franchises and, although the name certainly helps get customers in the door, Bad Ass executives know that they won't keep them if their products or customer service are inferior.

In the sports world, a fashionable logo for a minor league team without a large national fan base like the Carolina Mudcats or the Rancho Cucamonga Quakes helps the team earn additional money through merchandise sales. Although only a single part of the branding equation, great logos, whether attached to companies or sports teams, significantly impact brand value. Like other branding elements, a compelling logo alone will not help an organization develop and reinforce its brand if the products or services it offers are lacking. For major sports brands, such as professional sports franchises, to foster loyalty among fans they must consistently deliver a compelling entertainment experience that fans feel vested in. Such is the case with the Yankees, Cowboys, and Lakers, among others.

FutureBrand, a company that assists in valuing brands, determined the value of each domestic professional sports franchise and brand by calculating the revenue and profit stream generated by the brand and the strength or degree of risk of the brand in its market in relation to competitors.

Specifically, FutureBrand considered a team's popularity, fan base, and factors that affected fan interest, size of media market, winning percentage, stadium operations, and the growth of the particular sport. This criteria, when taken as a group, suggests that great brands combine a committed customer base with a solid product supported by savvy marketing.

According to the study (see Table 9-1), the Yankees brand alone, which includes the blue and white interlocking "NY" and the team name itself, was worth $334 million in 2002, placing the team's brand in the same value category as Bose or Four Seasons Hotels. ^[1]

^[1] Rovell, Darren. "What's in a name? For Yankees, about $334 million." ESPN.com, July 10, 2002.

Table 9-1. Top-Ranked Sports Brand Values

Rank	Sports Franchise	Value (US $M)
1	New York Yankees	334
2	Dallas Cowboys	300
3	Los Angeles Lakers	272
4	New York Knicks	236
5	Washington Redskins	191
6	New York Giants	167
7	Chicago Bulls	156
8	New York Rangers	155
9	Green Bay Packers	153
10	Detroit Red Wings	152

The Cowboys brand was second at $300 million, followed by the Lakers at $272 million. Not surprisingly, all three teams have won at least three championships over the past 10 years. If and when any of these teams are sold, their brand value will make up a significant part of the sales price.

There is much to be learned from observing America's greatest brands, including the aforementioned sports franchises that recognize that they, like the leagues in which they play, have become valuable brand names.