What branding fears are holding you back?

Bill Black:

Thank you for listening. It’s a pleasure to have you with me. And, you know, we interview a wide variety of advisors, as I mentioned earlier. Over 1500 advisors have been on exit coach radio. So if you think about it and you want to listen to 20 minutes of business oriented information, head to wherever you listen to podcasts and look for Exit Coach Radio. My next guest, Meghan Lynch is a CEO of Six Point Creative, a brand strategy agency that helps second stage companies breakthrough growth plateaus. As part of her mission to help small business challenge the goliaths, Meghan has served as an expert advisor to second stage clients in a wide range of industries from fast casual restaurants to industrial manufacturers. And Meghan was named an enterprising woman of the year in 2019 and enjoys testing her limits as an endurance runner. Welcome to the show, Meghan, thanks so much for joining me.

Meghan Lynch:

Thanks so much. I’m glad to be here.

Bill Black:

My pleasure. Wow, you have an interesting background, I’d love to hear more about that. Tell our listeners a little bit more about you and your business and we’ll get into some of the questions.

Meghan Lynch:

Yeah, sure. So I started Six Point it was around 2007, just as the market was crashing. So I made it through one grade.

Bill Black:

Perfect timing.

Meghan Lynch:

Recession then. Yeah, perfect timing. And basically, when we started, we were a very generic, local, regional full-service marketing agency. And I’ll put full service in air quotes because it was a few of us, a few smart people in a room, just kind of getting stuff done. And over the years, as I started to grow that business and kind of get myself more educated about what it means to grow and lead a company, I started joining more peer round tables, and really educating myself because I don’t have a background in business or anything like that.

And while I was doing that, I just started spending more and more time with a lot of family-owned businesses, second-generation businesses, closely held businesses that people were starting, and kind of growing and trying to sustain. And I just realized these are my people. That I love working with these kinds of businesses that are devoted to their communities and are really trying to make something sustainable for themselves, their families, their employees. And it was also where I started to realize that the brand strategy work that I was doing for other kinds of companies was particularly helpful to these companies. That they didn’t often really know how to build equity in their brand or how to use brand strategy to create business outcomes.

Bill Black:

There’s a lot. There are many facets of what you do that intrigue me. But one question I have before we get into it is what do you … when you say a second-stage company, tell us what you mean by that.

Meghan Lynch:

So second-stage companies are between 10 and a hundred employees. It’s usually around then you start to have this tipping point early on of starting to feel some of these, just pains of oh, we used to just grow with no problem, and now we’re kind of plateauing. Or it’s not as easy to get customers as it used to be, or we need a lot more processes or the people problems are getting out of control. All of those kinds of early-stage pains.

Then later on in the second stage, often the issues are much more about,  now that we have processes and systems in place and we’re really ready to grow, how do we keep alignment? How do we kind of bridge where we came from and who we used to be, with what is going to get us to this next level and not kind of lose the DNA of who we are in the growth and scaling process? So that kind of tends to be what second-stage companies are all about. And it’s sort of both a uniquely painful business life stage, but also kind of a uniquely exciting and just transformational one. If you could make it through second stage, you can do anything.

Bill Black:

Very good. And you know, I’ll use a golf analogy I know a lot of people, when they start, they start tracking their handicap and it’s probably in the twenties or something very high. And it’s fairly easy with some regular practice to get that down to about an 18 or 17. And then you get into the next phase, maybe this is where the second stage comes in, where you have to start changing your game to get better.

Meghan Lynch:

One of the things that we often remind our clients is, what got you here won’t get you there.  Whatever made you a better golfer early on, you have to kind of get into more like nuance finesse work to make that next leap.

Bill Black:

And that’s where you need, that’s where you really need an outsider to help you to maybe … because there are rules of the road and tricks of the trade. So there are things that need to be probably looked at differently and implemented. What are some of the fears that hold high potential companies back from growth?

Meghan Lynch:

I think that that fear of loss is it’s a very strong, human feeling.  I feel like particularly for second-stage companies, for family businesses, it is something that really does strongly hold them back from growing and from even building equity in their company. Because they have a lot to lose, right? They have employees who are counting on them, they have a reputation, they have customers who are counting on them. Oftentimes their identity is very tied up by this point in the business and what they do in their community. Sometimes they are like pillars of the community. So the stakes are not low for them. Sometimes they let themselves get so afraid of, oh well if we change anything, we’re going to lose what we have. And I think that in our experience you can kind of have both, right? You can keep what you built and you can also make the changes needed to position yourself for that next week.

Bill Black:

So it’s a kind of a case of if it ain’t broke, don’t fix it, but they don’t realize that it is broken or it’s not going to achieve high growth from here on out if they don’t make some changes. And I think one of the areas that might hold back some companies is they’ve always done it this way. And I work with a lot of family businesses and they basically … there’s a new generation coming up saying “things have changed. We need to change up how this business looks, how it looks to the world.” What are some of the brand strategies that you run into that need to be put in place for family businesses?

Meghan Lynch:

Yeah, it’s such a good question. I think particularly for family businesses and especially that are working, not generational, like conflict or transition, a lot of what they’re dealing with I would say over … of all the family businesses that we work with, I would say most of them when they come to us have 70% or more of their customer concentration in one market, or even in just a few big customers, big relationships. And it’s just super, super common when you’ve had this long track record of success, family businesses are very relationship-oriented. So this idea of doing anything new becomes also sort of like a threat to the stability of the business because it’s like, oh, well if we enter this new market, if we do too much digital, we’re going to lose these customers who got us to where we are.

But at the same time, that level of concentration is so high risk, that it’s really not a sustainable way to be around for the next 20, 30, 50 years. So a lot of the work that we do is around helping them diversify that customer base and really say okay, well, how do we talk to these existing customers, make sure that we are not going to lose them, and create a strong communication plan around whatever’s happening. Look at some of these new opportunities that are on the table and pick the ones that are the strongest and also craft a strategy that opens up some new business, diversifies the business, strengthens the brand. So I think that brand strategy becomes a lot about that diversification piece, especially as a first problem to tackle.

Bill Black:

In the COVID environment and hopefully post COVID environment, things have changed obviously over the last year or so. And is brand … have a lot of people have been forced to change their branding, to appeal to the online marketplace more, into the worldwide market, if you will? The companies that might have been perceived as too regional in the past, as they changed to more of an online footprint, are they … what are some of the things that they’re doing to reflect that?

Meghan Lynch:

Yeah. I mean, we’ve seen just obviously like an explosion in e-commerce, and even for brands that historically have not dipped their toe into e-commerce or really haven’t paid much attention to it, they really started seeing growth and the business case for like, okay, well we’re getting growth and we’re not even doing anything, so maybe we really need to do this. Or they were seeing their competitors grow while they were staying out of that game. So that’s definitely something. And I think, for a lot of companies one of the things to realize about digital is that it’s really no different. Like the basics are the same, you create good relationships, you’re authentic, you are clear and consistent in your messaging. The same true basics that make other channels effective are the same here.

I think it’s where people get tripped up, they don’t know what they need to pay attention to. They don’t know which channel is right for them,  where their customers are or where their prospective customers are. Again, they kind of get frozen with, we don’t even know where to start. So often the starting point that we use with our clients is to just start serving and interviewing your customers and talking to them and saying, what is your life like? It’s not about satisfaction surveys. How often are you online? What sites do you go to? What devices do you use?

Just kind of understand what their buying behavior is like, in a way that’s relevant to your business. But all you need to do is do 10 or 12 of those interviews and you already start seeing some patterns and it starts to demystify … if a company’s like, oh my gosh, do I have to worry about Tik Tok? Should I be on Instagram or Facebook? Or should I be on LinkedIn? Should I be doing e-commerce? Your customers will tell you that information. We’re just often, for whatever reason, reluctant to ask.

Bill Black:

Yeah, so many platforms, so little time. One of the things I’ve heard from companies is that as they start to think about future generation ownership or whatnot, or passing the baton, that they’ll change from a name-based company to maybe initials instead of the name. Or if they say we’re the Orange County, they’ll pick out that region, so that they’re more … so that they’re not confined in the consumers’ mind to only working in a certain region. What are some of the other common mistakes you see that companies make when they’re contemplating rebranding?

Meghan Lynch:

I think sometimes it’s stressing too much about those details. We think that we put way too much weight in a name and we’re like, Oh, this has got to explain the full scope of what we do and capture it. And I often think that’s wasted energy. You think of all of the most valuable brand names, they’re all nonsense names, Xerox and Apple and Google. It’s like, the name is what you make it, and your brand is what people say about you when you’re not in the room to quote Jeff Bezos. It is your reputation.

So if you build equity in a brand name, it always hurts me a little bit in the gut when people change their name to initials, because it’s like even it was a person’s name, that name has personality. That name has an emotional connection and you just stripped all that away and became initials. I would rather change the story, Let’s not necessarily jump right to a name change or a logo change or whatever. Sometimes it’s really about communication strategy, not those kinds of superficial elements that I think sometimes we spend a little too much time on.

Bill Black:

Very, very good advice. How about for some of these multi-generational family businesses where it started with the parents. Okay, then they had their few children get involved. Now those children had each had a few children and now the third generation is now 15 potential people getting involved in the business. And pretty soon you have this big kind of mushrooming number of people that want to be involved in the business, whether they’re qualified or not. What about … have you run into situations like that? Where families have said, look, let’s do this. Let’s get involved in the community in another way, maybe with a family foundation, and really get involved with some charitable groups or others. And let’s give some of those family members a job of working with that. How do you figure out how best to show up in the community as a family business?

Meghan Lynch:

I love that question. I think that there is such power, again, oftentimes these family business brands, and once they get to that third-generation stage, they truly are very powerful in their community and their reputation, their name, just their presence at certain events, and things like that are very symbolically powerful and then also, it can be economically powerful for a community. So I always love it when you can create a much wider brand impact and brand story by getting community members or family members involved in different ways. Like you said, setting up a foundation, sponsoring events, creating marquee events in the community. And then oftentimes too they’re leaders in their own industry as well. So I think to think both locally of where can we make an impact and where can we build the brand and the story and the loyalty locally.

If you work nationally or internationally, where could we also expand the value of the story in our industry? How could we as a family get involved in policy, in trade organizations, things like that, where it does really have a connection back to the family, even if you’re not involved in the day-to-day of the business. Getting to know the industry, being influencers in the industry, all of that comes back to the family eventually, and supports the work of the business and supports the equity that you’re building in the brand and therefore in the value of the company. So, yes, it’s such a good question. I think it’s such an overlooked asset that people don’t usually think about spreading out their influence in that way. So I’m really glad you asked that.

Bill Black:

Yeah, it’s branding and it’s really interesting, especially as a lot of our listeners head towards their thinking about exiting their business. Maybe they’re thinking about selling it to a much larger business in their industry as a strategic sale. And so they need to really work with someone to think about, well, how do we start showing up better, differently, in our industry so that we’re not begging them to look at us. They’re begging us to let them look at us. And so it’s really important. What you do is really, really important. And how do our listeners learn more about you and get in touch?

Meghan Lynch:

Sure, our website is sixpointcreative.com. And we set up a landing page for your listeners, so if you just do backslash exit coach, there is a free brand assessment on there. So if people want to take that quiz, you get a customized report based on the answers to see, where is your brand. If you’re thinking about exiting, how much work is there to do and where should you start and focus first? So that’s a helpful tool and there’s a couple of other resources as well about building brand value in your company, right on that site.

Bill Black:

Great information. We went through a lot of information pretty quickly and I hope you’ll come back and share more with us down the road. Because I think again, we just started to scratch the surface, but you really gave our listeners a lot of great tips today, Meghan, I really appreciate it. And thanks so much for joining me today.

Meghan Lynch:

Thanks so much for having me on Bill, appreciate it.