Brand doesn't matter... or does it?

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Global Watchtower

Common Sense Advisory Blogs

Posted by Renato S. Beninatto on September 22, 2006 in the following blogs: Supplier Business Issues, Translation and Localization
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In our writing at Common Sense Advisory we have long contended that brand doesn't matter in the language industry. Proof of it is that looking back 10, 15 and 20 years, none of the top LSPs then are in businesss today. In the late 1990s the biggest firms were Berlitz, Bowne, Lernout & Hauspie, Lionbridge, and ALPNET -- only Lionbridge remains, having ingested all or part of 3 others (SDL owns ALPNET, the fourth).

Companies spend a lot of money to stake out their position in the marketplace. They build brand awareness through advertising and public relations activities. But unless they can track and compare that expenditure against the market and over time, investment in branding falls into the "wasted marketing dollars" category.

The ultimate goal of any marketing campaign is to achieve brand recall; that is, the customers' ability to retrieve a brand from memory when given a product category but not any brand names. This is also referred to as spontaneous or unaided awareness.

For our exercise in measuring unaided brand awareness, we surveyed 100 buyers of language services and asked them to name all of the translation/localization companies they could think of. They listed a total of 289 companies without prompting. Companies number 1 and 3 in our Ranking of Top 20 Translation Companies for 2005 were, not surprisingly, the first- and second-ranked LSPs in terms of brand awareness (the 2nd-biggest LSP, L-3, focuses on government clients so fewer buyers are aware of its existence). What did surprise us was that Moravia Worldwide from the Czech Republic ranked third in brand awareness, but it's 13 in our top 20 list. Moravia, a Microsoft Premium Vendor, reached third place in our exercise by being cited by 1 in 3 respondents in our survey. So, the envelope please: Lionbridge, SDL, and Moravia finished 1-2-3 in unaided brand awareness.

We also marveled at the brand performance of Bowne and Berlitz, each with 7% brand awareness. While Berlitz likely owes some of its performance to its language training business, it still retains some awareness due to its LSP division (acquired by Bowne Global, in turn purchased by Lionbridge). As old timers on the park bench can attest, some brands become part of the business and cultural landscape, far outlasting the company itself.

So is brand really that important in the language services? We still believe that consistent good service -- rather than heavy spending on promotion -- drives brand awareness.

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