6 Reasons Why Branding Is Important For Small Businesses

Just because your business doesn’t have a large amount of capital isn’t reason enough to overlook the importance of quality branding. Settling on a simple logo and a fun business card design isn’t enough to create a brand that will leave a lasting impression.

Branding is vital for small businesses because it drives public perception and is one of the most critical factors behind purchasing decisions. Branding helps differentiate your business from other companies in a similar market. Good branding will increase brand awareness.

Focussing on branding your small business shouldn’t be a daunting task. Don’t allow yourself to get lost in the finer details of branding your business. Instead, think about the steps you can take to optimize your business to achieve maximum results.

Why Branding Is Important

Before we delve into why branding is specifically vital to your small business, we first need to establish why branding is essential regardless of many employees your business has or how many products you sell.

Branding is a function that your business utilizes to keep in constant touch with your consumers. Focusing your attention on your business’s branding helps build out your core marketing strategy.

Your business’s core strategy should be made up of four essential pieces.

  • Substance. Which target demographic are you trying to reach, and why?
  • Structure. Where is your content? How is it organized? How do people find your content?
  • Workflow. How does your content happen?
  • Governance. Politics, guidelines, and standards.

Focussing on these four essential pieces will create a bigger picture of your brand, rather than just the product your business sells, which is the result. Your business’s brand should be made with a strategic outcome in mind.

Let’s look at six reasons why branding is important specifically for your small business.

1. Reputation

A brand is only as strong as its reputation. Your business’s reputation is derived from the public’s trust in your brand. When you professionally present your business or brand through branding, you reassure your target audience that you have a legitimate business, that you can be trusted with their money, and reassures them that the product you advertise will be delivered or the service rendered.

It is vitally important that your branding reflects your business’s reputation. If there is a disconnect between the brand’s perception and its branding, the confidence in your business will start declining.

2. Employee Morale

About 51% of employed Americans say they get a sense of identity from their job. Therefore, it is your responsibility to have your business’s brand reflect your values and the values of your employees. If your brand showcases motivated confidence, you will, in turn, attract motivated, confident people looking to join your business. When your brand is something to be proud of, your employees will share in that pride.

Low morale in the workplace will often keep your business from achieving its goals and will inevitably impact your business’s bottom line.

3. Audience Growth

Good branding opens up the door for new customers to find your brand. The more attractive your branding, the more people will pay attention to your brand. Ensure you know who your target audience is and adapt your branding accordingly.

Small businesses often make the mistake of thinking just because they have a couple of hundred people interested in their brand, that’s as big as it’s going to get.

The exact opposite is true. 56% of consumers believe that the brands they support need to understand their wants and needs. Investing time, money, and effort into branding that focuses on your target audience will give you insight into how to serve them better and significantly increase your marketing effectiveness.

4. Develops Brand Strategy

Your branding will give you a clear sense of the business challenges and objectives and help define how your marketing strategy will fulfill them.

A Clearly defined marketing strategy will provide you with essential metrics that can be measured and improved upon, everything from behaviors to actions and action paths to results.

If we define your marketing strategy as a plan of action designed to achieve a particular outcome, your marketing strategy’s desired outcome would be aligned with your business’s overall objectives or challenges. For example, suppose one of the overall goals was the acquisition of new clients. In that case, a possible marketing objective might be building brand awareness online, and that awareness can be created through effective branding.

5. Increased Revenue

The use of effective targeting branding is the best way of getting people to talk about your brand. Because of this, your brand’s logo, marketing strategy, and reputation need to work hand-in-hand to create a lasting impression on your consumers. The more recognizable and memorable your brand is, the more sales it will generate when people share their experiences with your business.

Referrals made by a customer should be included as part of the customer’s revenue. A customer who develops brand loyalty based on your branding will often stay with your business longer.

A successful relationship with a customer is based on meeting or even exceeding their needs. It is in determining what problems the customer has and providing solutions, sometimes before the problem occurs. It depends on continually giving the customer a reason to transact with your company above any other. Your business’s branding can heavily influence the decision they make.

6. Staying Competitive

Today’s market is highly competitive, and online shoppers tend to compare prices across multiple sites looking for the best deals instead of staying loyal to a specific business. Because of this, businesses need to keep their costs low, leading to reduced margins and race to the lowest price. Creating a brand that shows confidence tells the consumer that your brand has more value than other cheaper alternatives.

Proper brand optimization can give your brand more ownership of the search engine results pages (SERP) real estate and can also be used efficiently to target competitive terms. Just as rich media can help highlight the content on a page to a visitor, they can also aid search engines like Google to rank pages, provided they are labeled correctly.

Good branding is an excellent way to differentiate yourself in a saturated market and gives you a competitive advantage over other businesses in a similar space.

Physical Branding

Bolstering your brand identity through physical branding gives your business a face that consumers can attach to. When creating a catchy logo or picking out your storefront’s décor, everything you do needs to reflect your brand’s message and values.

Consider using things that the passive consumer might see when going about their daily shopping, whether printed signage, a banner, a billboard, or a branded ledger. Your primary focus is to entice a prospective customer to investigate further, not to bankrupt your business.

Digital Branding

Digital branding builds on and adapts the principles of traditional marketing. Through the power of social media and online retail, many people are ditching the way their parents shopped and how they interacted with brands. A Pew Research Center study shows that roughly eight-in-ten Americans are shopping online, and 15% make online purchases every week.

Utilizing digital ads that can be in either graphical or text form, you will be able to reach thousands of consumers. Successful brands have incorporated social media accounts across various platforms to interact with their audience more directly. Using social media allows you to learn from your customers and adapt your marketing strategy in real-time.

Another alternative is to start a blog for your business and post articles that gives your customers useful information about your products, services, or industry-related topics, giving your business a sense of authority on the issues at hand.


Branding should be a fundamental part of your business strategy. It is the first thing potential customers see before deciding whether to invest more of their time and resources into your product or service. Utmost care should be given to branding to ensure that it reflects your business’s core values and ideals and leave a lasting impression on any customer that might come across your business.

For a more in-depth look at how to create a brand identity, feel free to check out my post on it here, or download my free ebook by subscribing to our newsletter here.





Similar Posts