If you have an opportunity to call your company a family business, do it. Customers trust family businesses more.
The family business brand is a mark of trust. It may not be the reason why a customer buys a company’s products and services, but it can enhance the brand loyalty and affinity.
A distinct family business brand creates a halo effect. According to a research report by the Institute for Family Business, the family business brand enhances perceptions of trustworthiness, social responsibility, quality-orientation, and customer-orientation.
The report also found that it didn’t matter if the brand was B2B or B2C. Two-thirds of family businesses find their corporate reputation is superior to non-family competitors.
A family business may not be the largest brand in the category, but the family business brand adds weight. It creates a story and legacy that can place the business on equal footing with its larger rivals.
Families Are Messy
I know a few family owned business that refuse to acknowledge they are family businesses publicly. They believe that family doesn’t mean professional.
This can be true. Families are inherently messy. We all have our issues, and sometimes that can spill into the operating company. The irony is the messy factor can humanize the brand.
Public companies are often called “faceless” and “soulless.” This isn’t exactly fair, but it highlights how the family story enhances the brand. It creates a point of reference that we can know, like, and trust.
The caveat is messy is fine unless the behavior is fraudulent or incompetent. A family has a responsibility to the brand. They are the holders of the founder’s vision, and the family brand is intrinsically linked to the business brand.
A Legacy of Trust
Simply calling your business a “family business” isn’t enough to enhance the brand. The family brand and the business brand have to be linked.
The family brand is the human element. It enhances the business brand in three key areas:
- Heritage: The history of the business and family, and the legacy in the community.
- Innovation: How the company and family evolved, changed, and grew. As well as its commitment to innovating and winning.
- Values: What the family believes, and its responsibility for the business and community.
These three elements all point towards longevity. Family businesses are in it for the long haul, and that creates a legacy.
Publicly owned companies, on the other hand, are under ever increasing public scrutiny:
- Excessive executive compensation and bonuses.
- Revelations that corporations are paying low to no taxes.
- Short-term thinking and quarter-to-quarter decision making.
Big corporations are losing trust, while family businesses are gaining it. The family’s legacy elevates the brand and signals that this business is more committed to its customers, employees, and the community as a whole.
As markets commoditize use every advantage at your disposal. If you’ve got it, flaunt it. The family business brand is a mark of trust.