How To Measure The ROI of Good Branding

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How To Measure The ROI Of Good Branding

A strong brand is more than just a logo or a colour palette—it’s how your customers perceive you, the emotional connections they have to your brand, and your ability to stand out.

By Abbey Alexander

Investing in branding and creative work is usually viewed as an expense rather than an investment or revenue-driving strategy. Unlike performance marketing where your returns are measured in clicks and conversions, branding’s impact is more long-term and indirect.

But when branding is done well, it strengthens customer trust and loyalty, helps you charge more for your goods, and increases the success of your marketing.

So how can you understand and measure the ROI of branding? What tangible metrics and real-world examples showcase its value?

Why Branding Matters for Business Success

A strong brand is more than just a logo or a colour palette—it’s how your customers perceive you, the emotional connections they have to your brand, and your ability to stand out.

If you invest in good branding, expect to see:

Higher Customer Trust & Loyalty → Customers spend money on your brand on an ongoing basis. (Increased lifetime value (LTV) and repeat purchases.)

Better Pricing Power → Customers are willing to pay more for what you offer.

More Effective Marketing Spend → It costs you less to get customers because they already recognize and trust your brand. (Lower customer acquisition costs (CAC) due to brand recognition.)

Increased Brand Awareness → People know about you, talk about you and look for you online without needing to be prompted by an ad. (Higher organic reach and referral business)

Stronger Employee Retention & Attraction → You attract the best talent and when people work for you they don’t want to go elsewhere. (A well-positioned brand draws top talent and reduces turnover.)

Establishing Baseline Metrics Before Investing in Branding

Before diving into a branding exercise, figure out where your brand currently stands. What are your baseline metrics right now?

Brand Awareness: How much website traffic are you getting? What’s your search volume for branded keywords like? What about your social media engagement?

Customer Perception: What are your online reviews like? How about any sentiment analysis, or survey data?

Conversion Rates: What are your website engagement metrics like? How willing are people to give their contact information to you? How about your conversion rates for purchases or completing contact forms?

Customer Retention & LTV: How many of your customers are making repeat purchases and referrals?

Companies with strong brands see up to 30% higher customer lifetime value (LTV) and 20% lower cost per average click (CAC) (Lucidpress, 2023).

How Branding Translates to Revenue

Branding impacts your revenue and profitability. If you’re working on improving or updating your branding, here are some benefits you can expect:

Stronger Brand Recognition → More people searching for you directly online and getting in touch without you prompting them. (Increases direct traffic and inbound inquiries.)

Customer Loyalty & Retention → You lose fewer customers over time which also means people spend more money with you over time. (Reduces churn and boosts LTV.)

Consistent Brand Messaging → Your marketing performs better because people recognize and trust it, and in turn they’re more comfortable giving their information or buying from you. (Increases marketing efficiency and conversion rates.)

Differentiation from Competitors → When your customers see you as being distinct, trustworthy and a standout from the competition, it makes choosing your brand a no-brainer. If you offer premium products or services, good branding positions you as a premium brand and you can charge more. (Creates pricing power and premium positioning.)

Case Study: Liquid Death

Turned a basic commodity (water) into a cult-favorite brand, leveraging heavy-metal aesthetics and humour to reach a $700M+ valuation.

How to Measure the Success of Your Branding

Focus on the following performance indicators (KPIs) to measure the impact of your branding efforts. Make sure you compare the results with specific events over time.

Brand Awareness

Growth in branded search volume: How many more people (%) are searching for keywords in search engines that have to do with your brand specifically (brand name, product name, etc.)
Increase in social media mentions and engagement: How many more people (%) are mentioning you on social media and engaging with your brand? Engagement can also be boosted by other factors so look more closely to really know what’s going on.
Rise in direct website traffic: How many more people (%) are going to your website directly? Ie. Not finding you in an ad or through another link like an ad.

Customer Sentiment & Perception

Improvements in Net Promoter Score (NPS): Are people rating your company higher? Are they more satisfied with what you’re doing? Are they referring you to more people?
Higher review ratings and sentiment analysis: Are you getting more or higher ratings online?

Conversion & Revenue Impact

Increased lead-to-customer conversion rate: Is the % of people who were leads (had not purchased yet) and are now customers higher than when you started?
Lower website bounce rate and higher session duration: Are fewer people leaving your website as soon as they land on it without scrolling or clicking anywhere? Are people spending more time on your website than before?
Sales growth following a refresh or a rebrand: Are your % of sales going up?

Businesses with consistent branding see an average revenue increase of 23% over time (Lucidpress, 2022).

The Long-Term ROI of Branding

Unlike short-term, one-off marketing campaigns, the benefits of investing in branding compound over time.

Here’s how your investment pays off:

It Drives Brand Loyalty that Builds Over Time: Apple’s brand loyalty drives 92% repeat purchase rates (Statista, 2023).
Your Stock Value Goes Up: Rebrands can increase stock prices by 5-7% (Harvard Business Review, 2020).
You’re More Resilient In A Crisis: Strong brands recover faster from economic downturns (McKinsey, 2022).

Good Branding is Worth It

Good branding is a long-term strategy for growth and evolution that continuously builds customer loyalty and trust, makes your marketing efforts more effective, and it helps you make more money. If you track branding performance indicators and take a strategic approach, you can calculate its ROI and make calculated decisions on how much to invest on an ongoing basis.

Strong branding is not an expense—it’s an asset that appreciates over time.

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