Why your business needs “Branding Insurance”. And no, it’s not something you can buy!

Insurance, when invested in properly, can be a lifesaver. I know this personally from observing the experience of one of my co-founders who, around five years ago, was suddenly afflicted by a chronic illness that none of the local doctors in Barbados could figure out. The illness came out of nowhere – no warning signs. Nothing! One doctor described her ailment as “something you read about in a textbook in med school and never see again in real life!”

After exhausting all of the local treatment options, she sought medical treatment from some of the top diagnostic hospitals and clinics in the US. She was able to do this because our company had invested wisely in health insurance for our employees, and much of my co-founder’s treatment was paid for by our medical insurance plan. Even though we could never have predicted that my co-founder would have experienced such a left-field medical enigma, our investment in insurance paid off in the long run.

What does any of this have to do with “Branding Insurance”? And what is “Branding Insurance” anyways? Don’t worry, we’re getting there.

Everyone has their favorite food joints – places they know they can rely on for consistently great service, food and beverages each and every time. I have mine, and I’m certain you do too. My “go to” shortlist includes a business casual restaurant that I take clients to for a business breakfast or lunch, a fine dining restaurant with an amazing ambiance that is perfect for romantic evening dates, and a handful of coffee joints that I can visit to do remote work on my laptop while sipping a delicious latte.

I once visited one of these favorite food joints (I won’t call them by name) for a quick lunch. To my surprise, the service was pretty awful. It took forever for a waitress to take my order and even longer for the food to get from the kitchen to our table. The restaurant was packed to capacity and the staff was clearly frazzled! You could see it on their faces! I was unimpressed. By the time I got my meal, I was ravenous and grumpy. And so were other customers. You could also see it on their faces. At the end of my meal, I paid, left and went home, terribly disappointed with the experience – but wondering what had gone wrong that day. Perhaps they were short-staffed because some of their employees had called in sick. Maybe some vital piece of equipment in the kitchen had broken down. Perhaps the delivery service they used to bring the fresh ingredients needed to prepare customers’ meals had gone AWOL. Or, maybe, they were overwhelmed by a totally unexpected uptick of customers that particular day. Whatever the reason, it had resulted in subpar service for myself and many other customers.

But, despite the poor service I had received, I was back at the restaurant the very next day for lunch! Why? Because over the past few years, the restaurant had invested in what I call “Branding Insurance”. “Branding Insurance” is essentially the customer loyalty that a brand builds up over time by delivering consistently above-average products and services that customers love. During times of crisis when things go awry, a good “Branding Insurance” policy kicks in and (at least partly) “covers” the organization against the crisis which it is experiencing. “Branding Insurance” isn’t something you can purchase from your favorite insurance firm. It’s something that has to be earned through hard work and dedication.

This particular restaurant had built up a high level of “Branding Insurance” (i.e. customer loyalty) with me over the years by proving themselves to be a top-tier eatery where exceptional service was the norm.?The employees at this particular restaurant greet me by name whenever I pop in for a meal or a coffee, they know my favorite dishes and my preferred seating. When I call to make an order in advance or to place a takeaway order, they recognize my voice (or maybe they recognized my telephone number thanks to their phone system’s caller ID feature). In fact, 9 out of 10 experiences with this particular eatery, the restaurant had not just met, but actually exceeded my expectations of service and food quality – earning my respect, building a strong brand and also earning a great deal of customer loyalty on my part.

And, just like the health insurance policy that stepped in and covered my co-founder’s medical treatment for the ailment that none of us could have predicted, the restaurant’s “Branding Insurance” had kicked in and covered the previous day’s poor service that likely was the result of some unfortunate, unforeseeable challenge that had knocked the wind out of them. Because of their years-long investment in building a strong brand that made me feel valued and special, I was willing to give them another chance – the very next day, in fact! I had a hunch that the prior day’s poor service was a one-off event, and that whatever problems that had caused that poor service would be dealt with a sense of urgency!

And guess what! My hunch paid off. Despite the challenges they had experienced the prior day, the restaurant was on point! A friendly waitress took my order after just a few minutes of being seated, the food came from the kitchen to my table at lightning speed and was absolutely delicious. The staff, who had looked quite frazzled the day before, were calm and in control – even though the restaurant was as packed as it was the prior day. Whatever problems they had experienced just 24 hours ago had evidently been solved.

Despite their best efforts, no business gets it right 100% of the time. Sometime during the life cycle of your business, something will go wrong that may threaten your reputation or may cause displeasure among your customers. Maybe your website will crash unexpectedly, perhaps a vital piece of machinery will fail when you need it most, or you may inadvertently put out a product or service that fails to live up to customers’ expectations. If you haven’t “insured” your brand, these events may cause your customers to write you off completely. But if you’ve invested wisely in a “Branding Insurance” policy, many of your customers just may give you an opportunity to win back their trust and respect.

Your business, too, can benefit from investing in “Branding Insurance.” But again, this isn’t something you can buy. It’s something you’ll have to earn by proactively developing enough brand loyalty among your customers that when (not if) something goes badly with your business, you’ll be “covered” with an opportunity to win back their hearts.

Thinking of investing in “Branding Insurance” for your business? Here are a few quickfire tips that you might find useful.

• Just as with traditional insurance policies, investing in “Branding Insurance” is a proactive activity. You can’t wait until your home or business is destroyed by a natural disaster, then invest in an investment policy and expect that policy to cover the destruction already caused by that natural disaster. To be effective, you must invest in “Branding Insurance” proactively – before things go wrong. Do everything you can to make your customers feel special and valued, one experience at a time before a crisis hits!
• The size of your “Branding Insurance” coverage is directly proportional to the “Branding Insurance” investment that you make ahead of time. Small investments in your “Branding Insurance” policy will result in small “Branding Insurance” coverage when things go wrong. Enormous investments in “Branding Insurance” will result in enormous “Branding Insurance” coverage. Ensure that developing high levels of customer loyalty is one of your business’ top priorities by investing massively in “Branding Insurance”.
• “Branding Insurance” isn’t something that can be invested in solely by your organization’s leadership team. For “Branding Insurance” to be effective, each and every member of your staff has to invest in your policy – especially staff members who are customer-facing. Remember, when we are speaking about “Branding Insurance”, we’re really talking about developing brand loyalty, and this is an exercise that all your staff members need to participate in.
• Just like a traditional insurance company “Branding Insurance” may not offer 100% coverage. With many traditional insurance policies, coverage only kicks in after you’ve exceeded a specific deductible – meaning that you may have to pay some costs out-of-pocket before the policy kicks in. Same thing with “Branding Insurance”. It is highly unlikely that your “Branding Insurance” policy will cover all of your customers. You may have to pay an out-of-pocket “deductible” for customers who simply won’t give you a chance to win their hearts back over. These are more likely to be people who don’t have a long track record of interacting with your brand and haven’t yet built up enough customer loyalty to convince them to remain a customer. “Branding Insurance” helps reduce the loss of customers following a crisis, but it won’t completely eliminate the possibility of some customers leaving your brand forever.
• ?“Branding Insurance” can only do so much for your business. If things go wrong in your business and customers give you a second (or third) chance to win them over, but you mess up again and again, you’ll eventually exhaust your “Branding Insurance” coverage, and lose your customers in the process.
• ?When it comes to “Branding Insurance”, actions speak louder than words. If you mess things up, you can’t just tell your customers that you’ll do better (although, at times, a formal apology may be required). You have to show them that you’re sorry for any poor experience that they may have had with your brand and prove that you’ve worked hard to fix whatever problems may have caused that poor experience in the first place.

Whether you’re a first-time entrepreneur or the CEO of a massive company, you should seriously consider investing in “Branding Insurance”. In much the same way that (a good) health insurance policy can help you to access the medical treatment you need to maintain good health, or (a good) homeowners’ policy can help you rebuild your home after a natural disaster, a good “Branding Insurance” policy, based on a foundation of solid customer loyalty can help your business bounce back after an unintentional mishap.

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