I had a conversation with someone recently who said, “Posting about a business on social media isn’t effective.” I asked, “Why do you have a logo and what is its purpose?” She replied, “its for brand recognition.” I then asked, “Why do you want brand recognition?” She said, “So that customers will think of me when they need the services I offer.” My final question was, “If your brand serves that purpose, wouldn’t it be best to have it seen by as many people as possible? Her answer was, “yes, I suppose so!”

There’s a psychological affect behind brand recognition. People will do business with brands they trust. When we’ve been around a while and businesses are familiar with our offering, they subconsciously begin to trust us more. That trust can lead them to want to do business with us. That is why big businesses spend millions each year to stay in front of us via television, movie product placements, billboards, social media, etc.

As small business owners, we often think that brand recognition doesn’t matter. We rely heavily on word-of-mouth. Word-of-mouth is the most effective form of advertising; however, word-of-mouth usually only happens if your service is consistently extraordinary. That’s the only way to get people telling others about us. Even then, it is still may be necessary to use additional means, although we may not need it as much as the businesses that struggle to achieve word-of-mouth.

While getting the word out about our business is important, it’s also important to make sure that the means are cost effective. We shouldn’t spend more than we can comfortably afford. Neither do we want to spend an amount that will be difficult to achieve a profitable return on investment. Be fiscally responsible in how you invest in brand recognition, but building it is necessary and important.

Eric L. Lipsey