Why Traditional Branding Is Useless for Service Providers If you are not likely to generate a client through an Internet search or advertisement, but do so through a connection, take a guess as to where you should be spending your time.

By Carol Roth

Opinions expressed by Entrepreneur contributors are their own.

Logos, color schemes, web layouts. As small businesses, we spend a lot of money on efforts to create the ultimate brand -- a brand that defines the business, conveys credibility and sets us apart from competitors. However, if you are a service provider, I am going to say something that is going to make the eyes of every branding guru on the entire Internet collectively roll back in their respective heads. You may be wasting your money.

See, for many service providers, the "branding" that matters is in the "Rs": results, reputation and referrals. When my merchant banking firm was primarily focused on investment banking services, you know what got us business? It wasn't our name, our logo, our business cards, our colors or even our website. In fact, I changed the businesses' name, logo and website several times. Those items were just collateral. What got us business was results, like selling scale manufacturer Pelstar to Newell Rubbermaid for a very attractive multiple or selling the Jerdon division of Applica for them when they had previously unsuccessfully attempted a process themselves. We also generated significant referrals from previous clients, private equity firms, lawyers and other service providers that we had worked with.

Related: How Your Friends Influence Your Success

Frankly, the firm could have had any name, tag line or colors. Our website only mattered as much as enforcing that we were credible. However, in our industry, as in many other service industries, almost no business comes in over the transom. If you are going to be spending multiple six-figures for someone to sell your business, you aren't doing an Internet search or judging a business card. What you are doing is getting a referral from a trusted decision maker -- almost without exception.

I know this to be the same and true for others. There are lawyers who I refer business to because of the great work I have witnessed them do for me and for others, whose firms' names I can barely remember. I couldn't tell you what my accountant's tag line is and I don't really care. Even household service providers that I use are only allowed into my home because someone else that I have confidence in has vouched for them.

Related: A Crash Course on Licenses, Joint Ventures and Partnerships

Yes, it may be cliché, but particularly in the services realm, people are doing business with providers that they know, like and trust. Sure, looking totally unprofessional can hurt your credibility, so you have to spend some money to have a brand that is in the realm of credibility. That being said, spending too much on your branding can be a giant waste of time and money. You will generate a higher return if you invest in developing your relationships and nurturing your current and past clients instead. Even putting time and resources into raising your profile as an expert will have more of an impact than deciding if you like burgundy or navy.

Now obviously, if your service is branding, you don't want to be the shoemaker whose children have no shoes. If that is your business, you need to walk the talk. But for many industry segments, "traditional" branding is one of the last places that you should be focused. Spend time thinking through how new clients are typically garnered in your industry. If you are not likely to generate a client through an Internet search or advertisement, but do so through a connection, take a guess as to where you should be spending your time.

Related: Your Ideas Have No Value

Wavy Line
Carol Roth

Entrepreneur, TV host and small business expert

Carol Roth is the creator of the Future File™ legacy planning system, a “recovering” investment banker, business advisor, entrepreneur and best-selling author. She is also a reality TV show judge, media contributor and host of Microsoft’s Office Small Business Academy. A small business expert, Roth has worked with companies of all sizes on everything from strategy to content creation and marketing to raising capital. She’s been a public company director and invests in mid-stage companies, as well.

Editor's Pick

A Leader's Most Powerful Tool Is Executive Capital. Here's What It Is — and How to Earn It.
One Man's Casual Side Hustle Became an International Phenomenon — And It's on Track to See $15 Million in Revenue This Year
3 Reasons to Keep Posting on LinkedIn, Even If Nobody Is Engaging With You
Why a Strong Chief Financial Officer Is Crucial for Your Franchise — and What to Look for When Hiring One

Related Topics

Business News

'The Last Straw': Customers Furious as Netflix Begins Charging Accounts for Password Sharing

The announcement is long-anticipated — Netflix has been threatening a crackdown since last year.

Business News

The Virgin Islands Want to Serve Elon Musk a Subpoena, But They Can't Find Him

Government officials would like to talk to Tesla's owner as part of an investigation into the Jeffrey Epstein case.

Business News

'Iconic': Woman Defies Wedding Food Budget by Ordering Chili's for Guests

TikToker Madison Mulkey is going viral for her savvy spending decision.

Growing a Business

My Startup Scored a Multimillion-Dollar Contract With a Fortune 100 Client in Just 3 Years. Here's What We Learned.

There's no perfect litmus test to gauge if you're ready to go after big business or not — but if you don't take the risk, you'll never realize the reward.


5 Questions to Ask a PR Pro Before Hiring Them

You probably haven't considered asking these questions, but they're a great way to find the right PR firm for your business.