Does corporate brand and culture affect the bottom line?

by Tony Fannin, president, BE Branded

I was in a discussion with a client a few days ago. The topic that came up was does brand and corporate culture really affect bottom line revenue? Some of the executive committee believed it does. The other half thought the ideas were too “soft” to make any real difference. Of course, mission, core values, and purpose came into play as well (see: Mission, core values, and brand). Again, half thought it was very necessary and the other half thought it didn’t affect how the company performed in the market place. Here are my thoughts about the subject.

First off, to me, culture is really internal brand. It’s what a company stands for to their employees, stakeholders, and vendors. It’s no different than the brand a company exudes externally. I do believe that internal brand/culture plays a big part in driving revenue. Because our customers are human, they operate on emotion. Granted, men tend to go more on logic, but in today’s world, women drive an overwhelming percentage of purchase decisions both B2C and B2B (see: Women in control of your marketing dollars) The business landscape has changed as well. Women are achieving greater power in upper management and the executive suite. Men do use subjective measures to figure out who to buy from (golf anyone?), but they use a different set of emotional criteria.

Internal brand/culture is more than just a feel-good type of thing. It’s not about people getting along, being a “family”. True culture is a way of living. It’s an esprit de corps. Some of the best cultures are hard and extremely demanding because they expect only the best performance, everyday. To those who are attracted to this, that’s what makes it great. The feeling of belonging to an elite group who’s on top of their game, ready to prove their worth under fire. Look at the Navy Seals, Apple, and WalMart. Other cultures can be centered around softer issues like Google and Starbucks. Either way, they still carry the same demands and expectations of adhering to what makes that company unique. So how does internal brand/culture affect the revenue?

• It attracts the right talent – Not everyone is built to work at every company. Just because they are a disaster at Company A, doesn’t mean they’re a loser. That’s why you see some average employees move to a different company and become superstars. If your internal brand/culture is clear and the expectations are defined, you’ll attract the type of talent that will align with the company’s goals, mission, values, etc. It’s been said, you don’t get people to “buy in” on the company values and mission. They must believe that way to begin with. You don’t have to manage the right talent. As a result, most people will agree, talent wins in the market place. The company with the right talent will dominate their sector and in the end, produce financial results. What would you rather have, a group of superstars or a group that just gets along?

• It creates unity – I’m not talking a “kum-by-yah” moment. It’s about unity of purpose. A well defined internal brand/culture unifies individuals into a cohesive team. Everyone pouring their energies and talent into a singular direction. When talent is aligned with the company mission and purpose, mountains can be moved. This is where Tom Peters states that “soft is hard, and hard is soft.” He’s talking about the soft issues like brand and culture have the ability to move mountains because of the infinite resources humans possess. The hard are things like technology or the newest product extension. They can be easily overtaken by someone else who creates an 8-speed over your 7-speed gadget.

• It creates how a company is perceived – In today’s environment, doing good is as important as what your company does for money. This is especially true amongst the up and coming 15 – 30 year olds. People know when you’re being a fake and in the end, you’ll be punished by the market place both financially and in PR. Your culture must be perceived as real and authentic. If you are genuine, the general public, your customers, and prospects will gain more respect for your company and will be glad to spend their money with you. This authenticity only comes when everyone in your organization believes in what it does and their purpose.

For those who want some stats to make this soft issue more concrete, I offer these:

• 46% of business financial performance results from corporate culture. Great companies have defined and known cultures.

• Companies with a clear internal brand outperform their competitors by 33% in customer retention.

• Culture driven companies outpace their sector in sales growth by and annual of 51%.

• These companies are 38% more profitable than those without a defined culture.

(from The Future of Human Resource Management by Meisinger and Ulrich)

To me, the biggest benefit of all is a company can invest their resources into activities that further their mission and purpose and spend less in trying to “manage” people. The right culture brings the right talent, keeps that talent, and leverages that talent to it’s fullest. And, as a result, the company become financially successful, not because it chased money, but instead, it built a company where high performance is respected.


About Be Branded

Tony Fannin is of President of BE Branded, an integrated marketing firm who helps clients BE Somebody to their customers. If you aren't somebody, then you are commodity.


  1. June 1, 2011 « TWO | HEADED | FROG - June 1, 2011

    […] Does corporate brand and culture affect the bottom line? […]

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