Branding & Compensation Strategy

Dannielle Blumenthal Ph.D.

@thinkbrandfirst

* All opinions my own.

Assumption:Brands Produce Value Out Of "Nothing"

• Generics are often just as good.• External marketing activities create the

illusion of a premium product.• The illusion is self-sustaining after the

initial investment.

Reality: The "Nothing" Is Real Employees

• Employees interact with customers. • Employees innovate. • Employees keep the system functional.

Market Logic: Divest Of Employees (Automate)

• “Employees are overhead.”• “Employees are replaceable.”• “Employees need us more than we need

them.”• “Pay them as little as possible and trust

them even less.”

Brand Logic: Invest In Employees

• The cost of labor is an investment in brand equity.

• Employees drive goodwill, reputation, preference, irrational loyalty.

• Align compensation with the level of contribution to the brand.

Sounds Harsh, But It’s Simple

• Exploited employees desert and destroy your brand: Compensate them sufficiently that they stay and continue adding value.

• Non-contributors kill the brand from the inside: Remove them from the organization.

Compensation Options Are Numerous

• Pay, bonus, cash award• Secure employment contract• Honors and awards• Leadership opportunities, training, travel• Volunteerism• The sky’s the limit – be creative!

Minimize The Pay & Prestige Gap

• What message does it send when the people who actually serve the customer are paid minimum wage?

• Why are executives distant from the action paid so much more, and treated so lavishly?

• Is there a business benefit here, or is the arrangement irrational?

It’s About Being Smart, Not “Nice”

• Exploited employees can cause the brand great harm.

• They don’t engage at work, they are undermining, they drag others down.

• They badmouth the organization.• They join competitors.• Better: Compensate & retain good

employees throughout the lifetime of the relationship, and afterward.

Think Brand First

• The rest will follow.• www.dannielleblumenthal.com• @thinkbrandfirst