Organization Age & Size Impact

A key role of brand management is to create and reinforce an identity that promises relevant points of difference to consumers. Smaller, younger organizations have an advantage in this area for a number of reasons:

Leadership
Smaller|Younger Organization: An entrepreneur with a vision and passion Larger|Older Organization: A seasoned executive with experience in running large, complex enterprises

Size
Smaller|Younger Organization: A small number of people who work closely together and often share the entrepreneur's vision and passion Larger|Older Organization: A large number of people in different divisions and departments with different functional backgrounds and allegiances, often very much decentralized

Business Scope
Smaller|Younger Organization: Usually focused on one core product or product category
Larger|Older Organization: Usually offering a wide variety of products and product lines, many times in multiple business categories and even in different industries

Brand Structure
Smaller|Younger Organization: Usually one brand
Larger|Older Organization: Often very complex including multiple brands, sub-brands, endorsed brands, etc.

Organization Infrastructure
Smaller|Younger Organization: Rapidly being built to support the entrepreneur's vision
Larger|Older Organization: Many assets, systems, processes, organizational levels, etc. Very difficult to change.

Corporate Culture
Smaller|Younger Organization: Usually strong based upon the entrepreneur's personality.
Larger|Older Organization: May evolve as new top managers are added. May be very strong based upon the legacy of a strong founder or a current strong leader. Companies that have long and rich histories often have entrenched cultures.

Marketplace
Smaller|Younger Organization: The business category is often in its infancy with many positioning possibilities for a new company.
Larger|Older Organization: Industry is often mature or maturing. Sometimes declining. Competitors are much more entrenched with few, if any, viable marketplace positions not taken. (Recently deregulated industries provide notable exceptions.)

Decision Making
Smaller|Younger Organization: Usually very quick with fewer decision-makers.
Larger|Older Organization: Depending on the organization design, the decision making process can be very cumbersome.

Financial Resources
Smaller|Younger Organization: Often scarce as the organization is growing rapidly and reinvesting all available cash flow. May be less scarce after an IPO.
Larger|Older Organization: Usually substantial including cash flow and borrowing capacity.

Primary Marketing Method
Smaller|Younger Organization: Publicity
Larger|Older Organization: Advertising

Brand Identity
Smaller|Younger Organization: Often evolving, but easier to encode in standards and systems (because the organization is starting with "a clean slate").
Larger|Older Organization: Often strong and entrenched, but more difficult to codify due to the scope and complexity of the enterprise and the inconsistencies that have arisen over time.

Brand Awareness and Esteem
Smaller|Younger Organization: Usually low or non-existent
Larger|Older Organization: Often high

Brand Differentiation
Smaller|Younger Organization: Usually very high
Larger|Older Organization: Usually declines over time as more and more competitors enter the market

The first two laws of branding in Al Reis and Laura Reis' book, The 22 Immutable Laws of BRANDING are as follows:

* "The Law of Expansion: The power of a brand is inversely proportional to its scope"
* "The Law of Contradiction: A brand becomes stronger when you narrow its focus"

Clearly these first two laws favor smaller, younger organizations.

Brand identity firms will tell you that often they can create much stronger brand identities for smaller, younger companies because those companies have fewer constraints (existing logos, store décor and signing), more focused businesses and stronger business visions. They also have a more coordinated marketing function (often a department of just a few people). Conversely, large organizations usually have separate product development, advertising, promotion, public relations, sales and marketing research departments (to name a few).