The Hidden Cost of Hypergrowth: Why Scaling Without a Brand Is a Recipe for Disaster
Every founder I speak with has three goals: Build, grow/scale, and funding. These three things are essential to most businesses no doubt — but is growth the king?
Here are a handful of names that come to mind when I think of scale and hypergrowth — Linkedin, Slack, Amazon, Zomato, Nykaa, Zoom. All of them have achieved a measure of success on all three factors mentioned above, and continue to do so. What does it really take to hyperscale a business?
Let’s break it down.
When we talk about growth, the metrics most founders look at are:
- Customer acquisition and the cost associated with it
- Retention and lifetime value
- Burn rate
- Margins and profitability
- Valuation and scalability
The “growth-at-all-costs” mindset some founders have is fundamentally flawed. While chasing scale and valuations, while working towards that hockey stick growth curve sounds enticing— most founders, I believe, need more than that to hyper-scale and grow.
You cannot chase hypergrowth at the expense of brand. That’s a fatal mistake.
The Brand Building Imperative
One of the most common sacrifices made in the race for hypergrowth is investment in brand building. Very few people talk about it, yet Kantar Millward Brown found that strong brands deliver a return to shareholders 31% higher than weaker brands
Building a brand during periods of hypergrowth creates equity and favorability. When those two elements occur, you also add intrinsic value to your brand.
Brand building future-proofs your company making you take the tough calls on
Do we want just customers, or advocates? — Branding ensures that your customers don’t just buy from you once — they keep coming back and tell others to do the same.
Do we want to skew perception and favorability, or are we just about capturing market share? — It’s not just about being top of mind, but being favorably remembered.
When you build a brand in a time of hyperscaling, you build unmatched loyalty from your customers that helps you fight competitors and market fluctuations. Strong branding accelerate growth.
Brand building while hyperscaling helps companies grow fast but also build value.
Here are three things that have to be in order if founders are looking to scale:
- A strong foundation of ‘why you’ and ‘what drives your customers to you’
- Operational excellence coupled with the right employees
- Strategic foresight: Anticipating upcoming trends or shifts in the market.
Hypergrowth is fragile. When the foundation of your business is shaky, it can collapse under pressure. Hypergrowth therefore arises from balancing a solid business model and ambition along with a vision for sustained scalability. Short-sightedness will kill your business faster than you can imagine.
As a consultant who’s worked with 100+ brands on their brand strategy, building and growth plans — if you want to build a brand that’s optimized for revenue, growth and scale, you need a balanced approach, where brand building is integrated into your growth strategy.
Build brand, and hyperscale
- Build for the customer, with the customer
- Focus on positioning to win, keeping you on top of the curve
- Data mining and using data to make brand-led business decisions
To do this you need to have
- Customer obsession- to build for the customer, with the customer.
Customer obsession is the foundation of sustainable scaling. When companies understand their “why” — they create purpose-driven solutions that solve real problems for their customers. Their why creates stickiness through customer obsession, which in the long term — works!
As Simon Sinek famously said, “People don’t buy what you do; they buy why you do it.” Your ‘why’ should guide your growth and brand building efforts.
Knowing your why is a portal into sustainable growth and scale, allowing you to focus on what truly matters: creating meaningful value for customers.
When you scale with the customer at the center, you build an unmatched customer experience. Your vision resonates, your messaging creates immense customer love and your brand builds loyalty.
A clear focus on your why is essential because while rapid scaling is the core mission, the evolving market is going to pull you in different directions — but if you’re rooted into your why — you can’t be swayed and you will be on a path of success.
According to Oberlo, Companies that maintain brand consistency reported revenue growth between 10% and 20% attributed directly to their branding efforts
2. A focus of playing above the curve — therefore, positioning to win the market
When scaling and hypergrowth is happening, it’s the easiest thing to be pulled into ‘marketing’ and not ‘brand’ activities. While marketing keeps the ball rolling, brand-building tells customers why your product or service matters.
Your brand positioning should focus on long-term relevance. When you’re relevant to current needs and demands, you are compelling and first-choice.
This is why brands should, IMHO, hire a brand specialist if they want to balance growth+brand, and have them grow in tandem — playing off each other.
3. Data driving cross-functional decisions — so that you’re spotting opportunities as they arise and capture them
As you hyper scale, you’re going to have access to immense amounts of behavioral data and along with that the pulse of the market. When a hyper-scale brand understands how to effectively use this data, they create a competitive advantage.
The real-time insights help the company make informed decisions that align the entire organization. As you collect more data, you also have insights into changes in customer preferences, demand-forecasting and disruptions.
A hyperscale company should be able to preempt market shifts and avoid costly missteps.
A hyperscale brand can use this to their advantage to have cross-functional alignment on goals, and how to get there. The insights from one chunk of data can impact and cause change in the operations of another part of the organization.
The cost of ignoring brand
Rapid growth can be exhilarating, but companies that prioritize growth above all else may find themselves overextended — making promises they can’t keep and therefore giving up the core of what made them successful in the first place.
Scale smart, not just quick.
This is where brand plays a crucial role. Investing in brand building doesn’t just fuel growth — it creates stability and belief. By focusing on customer experience and loyalty, companies keep old customers, while acquiring new ones keeping them both satisfied with product, service and more
Brand loyalty is the ultimate KPI for hyperscaling
Last but not least, acquiring new customers is known to be more expensive than keeping the old one’s. At this point founders should worry about the brand reputation in the market with current customers, and focus on that being a KPI for growth. When companies prioritize customer experience they indirectly invest in customer success.
Create customers and experiences that last
In conclusion, founders can create resilient businesses poised for long-term success by focusing on sustainable practices. By investing in your brand, you’re also investing in the customer’s success.
Brand building doesn’t just create new customers — it ensures they stay. This is the key to sustainable growth.
In the words of Jeff Bezos, “Your brand is what other people say about you when you’re not in the room.” As you chase hypergrowth, make sure you’re giving them something worth talking about.
