updated 4/6/2004 6:12:47 PM ET 2004-04-06T22:12:47

Many small business owners might think of a brand as the name attached to a company, product or service. But the concept of branding goes far beyond a catchy label or logo — it encompasses all aspects of business and how a company presents itself to customers, prospective employees and the circles it operates in.

To David F. D'Alessandro, chairman and CEO of John Hancock Financial Services, a company's brand reflects the reputation and integrity of the business — and, most important, its owner. And a brand matters even in a company's early days.

With a bad brand, "you may have a great idea ... but you can't get financing because people don't want to do business with you," said D'Alessandro, who has written books including "Brand Warfare."

Among the reasons why small businesses fail, D'Alessandro said, is "they've developed a bad brand, not necessarily for a product, but how they operate."

In a sense, building a good brand is no different from having a well-run business. The quality of a small company's services or products, how it deals with customers and whether it pays its bills on time are among the factors that go into a brand.

Another is how a company treats its employees. A company with a good reputation as an employer is more likely to attract top workers, and those workers become part of the brand.

"Everything you do from print to Internet to any kind of public interface of your business reflects something about your people," said Lisa Aldisert, president of Pharos Alliance, a New York-based consulting firm. "People are providing the intellectual capital that creates your reputation."

A good brand can be the best advertising tool that a small company can have, particularly when it operates in a relatively small geographic area.

"The goal of branding for a small business is to thrill your clients to such a degree that they become your unpaid marketing department," said David Martin, president for North America at Interbrand, a branding consultancy. "When someone thrills you personally, you tell five other people. If I thrill 100 clients today and each one of those 100 clients tells five people, I've just touched 500 people."

To Martin, "a brand should be the promise and the delivery of value ... and ultimately, what helps you to connect yourself with any revenue-generating audience."

A brand needs to be maintained, even nurtured. That means attending to customer service and staying on top of what's happening with your employees. And, if your company runs into problems, dealing with them quickly and honestly so your best efforts, not your worst mistakes, are what's talked about.

"When you fail, confront it early," D'Alessandro said. "Never underestimate the grapevine."

Aldisert pointed to Home Depot Inc. as an example of a company with a great brand that was losing some of its appeal due to the growing strength of a competing brand, Lowes Cos. Home Depot has responded to its slippage by renovating stores and shifting its focus more toward decor than hardware.

D'Alessandro emphasizes the importance of an owner's own personal brand throughout the life of a business. But it can be harder to maintain that good brand as the business expands and the owner's attention is naturally diverted.

Again, having employees who support and sustain a company and its brand can be the answer. With a solid staff in place, an owner can confidently delegate tasks and have time and energy to devote to a new venture.

"Successful small business people figure out how to return and hold great people," D'Alessandro said. His suggestion: Further include these employees in the company's brand by giving them a stake in the company.

"Small business people willing to give up some equity are usually successful, because high-quality people will usually come work for you if there's a real upside," he said.

All of this doesn't preclude coming up with a great name and advertising campaign for your company and your products and services. But without a substantial, well-run operation behind you, your brand could end up being little more than a facade.

© 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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