Branding is not a very recent phenomenon; in fact, some form of branding existed centuries back as well; over the years branding evolved, and in recent times the society has witnessed a brand explosion thanks to improves communication and easy access to mass-broadcasting systems. The manner in which companies brand/market their products has also evolved a lot over the years.
What is a Brand?
The good thing for consumers today is that there are so many options to choose from. Whether you want to buy a product or book a hotel room, there are several brands out there waiting to serve you. These companies using innovative marketing strategies that help consumers make a decision.
A brand is perception resulting from experiences with, and information about, a company or line of products. A brand is more than just a product, it is what people think about the product from their heads and hearts.
The American Marketing Association defines brands as a “name, term, design, symbol, or any other feature that identifies one seller’s good or service as distinct from those of other sellers”
The set of physical attributes of a product or service, together with the beliefs and expectations surrounding it – a unique combination which the name or logo of the product or service should evoke in the mind of the audience. (CIM)
Usually managers characterize a brand by describing all of the brand elements used to identify it, including its name, symbol, package design, and any other features that serve to differentiate that brand’s offering from competitors’
A firm’s brand equity often represents a substantial portion of its overall value.
- “..brand is a complex bundle of images and experiences in the customer’s mind” (Keegan and Green 2015, p. 297).
- “A name, term, sign, symbol, combination of these, that identifies, the products or services of one seller or group of sellers and differentiate them from competitors …branding can add value to a product. Customer attach meaning to brands and develop relationships. Brands have meaning well beyond a product’s physical attributes” (Kotler 2013, p. 254).
- “Brands are the culmination of a user’s total experience with a product…over many years…made of a multitude of good, neutral and bad encounters such as the way a product performs, an advertising message, a press report, a telephone call, or a rapport with a sales assistant” (Whalley 2010, p.81).
The Brand is King in a Global World!
A brand is the way a company, organization, or individual is perceived by those who experience it. More than simply a name, term, design, or symbol, a brand is the recognizable feeling a product or business evokes.
Brands, then, live in the mind. They live in the minds of everyone who experiences them: employees, investors, the media, and, perhaps most importantly, customers.
Simply put, brands are perceptions.
Brands are a means of differentiating a company’s products and services from those of its competitors. There is plenty of evidence to prove that customers will pay a substantial price premium for a good brand and remain loyal to that brand. It is important, therefore, to understand what brands are and why they are important.
You will find that products of certain brands cost more (compared to similar products from other brands). And that is because they are of better quality, are better designed, are visually appealing, and make you feel that you own something really special. A pair of Nike shoes is going to cost more than a local shoe brand.
When one thinks of a brand, it brings to the mind certain attributes about the product, and as such reduces the perceived concerns of a buyer, which he may otherwise have if the brand of the was not known. For most buyers, a brand evokes trust, complements his personality and is a sign of status.
What makes a brand?
- Brand name
- Logos and symbols
Critical elements of a brand
Key elements that defines a brand:
- Brand Purpose
- Brand Positioning
- Brand Promise
- Brand Personality & Values
- Brand Expression
A branding strategy (also known as brand development) is a long-term plan to develop the brand so that it is recognized and preferred by consumers.
What is Branding?
Branding is what separates similar products from each other, it is the process of creating a brand image that engages the hearts and minds of customers.
Branding is a name, term, design, symbols or any other feature that identifies one seller’s good or services as distinct from other sellers. ‘Branding’ refers to all of the activities that shape customer perceptions, particularly the firm’s activities. Branding then is the “management perspective” that focuses on perceived value of the product as found in a society.
Few definitions of branding:
“Ultimately a brand resides in the mind of the customer” (Achenbaum, 1993, in Baines, Fill and Rosengrum, 2017, p.492)
“..a brand is represented by a name, symbol, words, or mark that identifies and distinguishes a proposition or company from its competitors” (Baines, Fill and Rosengrum, 2017, p.492)
“Branding is a process by which manufacturers and retailers help customers to differentiate between various offerings. It enables customers to make associations between certain attributes and or feelings and a particular brand”
“Positioning is concerned with the processes associated with creating and altering the perceptions customers have about a firm’s products or brands” (Crawford, 1985, in Baines, Fill and Rosengren, 2017, p.490)
“…brand positioning is not about a brand’s physicality, it is about the place the brand occupies in a consumer’s mind” (Baines, Fill and Rosengren, 2017, p.490)
“What distinguishes a brand from its unbranded commodity counterparts is the consumers’ perceptions and feelings about the product’s attributes and how they perform. Ultimately, the brand resides in the minds of consumers” (Keller, 2002, in Kotler, 2003, p.419)
Importance of Brands: How does Branding help?
Businesses that invest in and sustain leading brands prosper whereas those that fail are left to fight for the lower profits available in commodity markets. Strong brands are able to establish a long-lasting place in short-lived markets. Consumers are willing to pay a premium for stronger brands.
McDonalds quote emphasizing the importance of brands: “…it is not factories that make profits, but relationships with customers, and it is company and brand names which secure those relationships”.
“If Coca-Cola were to lose all of its production-related assets in a disaster, the company would survive. By contrast, if all consumers were to have a sudden lapse of memory and forget everything related to Coca-Cola the company would go out of business.” Coca-Cola
Here’s what a brand does:
- It makes a promise to consumers.
- It serves as a driving, unifying force directing all functions of Marketing
- Differentiates a product from its competitors.
From a consumer’s perspective:
- It enables customers to make associations with certain attributes or feelings with a particular brand. If this differentiation can be achieved and sustained, then a brand is considered to have a competitive advantage.
- Successful brands create strong, positive and lasting impressions through their communications and associated psychological feelings and emotions, not just their functionality through use.
- It helps people to identify their preferred products.
- It reduce levels of perceived risk and in doing so improve the quality of the shopping experience.
- Helps people to gauge the level of product quality.
- Reduces the amount of time spent making product-based decisions and in turn decrease the time spent shopping.
- Provides psychological reassurance or reward, especially for products bought on an occasional basis.
- Informs consumers about the source of a product (country or company).
(Baines and Fill, 2014, p.455, p.457)
Manufacturers and Retailers enjoy brands because:
- Branding enables manufacturers and retailers to help customers differentiate between the various offerings in a market.
- are assets (have a financial value)
- Enables premium pricing.
- Helps differentiate a product from competitive offerings.
- Encourages cross-selling to other brands owned by the manufacturer.
- Develops customer loyalty/retention and repeat-purchase buyer behaviour.
- Assists the development and use of integrated marketing communications.
- Contributes to corporate identity programmes.
- Provides some legal protection.
(Baines and Fill, 2014, p.458)
Advantages of Branding to Seller
- Seller’s brand name and trademark provide legal protection of unique product features.
- Branding gives the seller the opportunity to attract a loyal and profitable set of customers.
- Branding helps the seller segment markets.
- Strong brands help build corporate image, making it easier to launch new brands and gain acceptance by distributors and consumers.
Benefits of Branding to A BUYER
- Help buyers identify the product that they like/dislike.
- Identify marketer
- Helps reduce the time needed for purchase.
- Helps buyers evaluate quality of products especially if unable to judge a products characteristics.
- Helps reduce buyers perceived risk of purchase.
- Buyer may derive a psychological reward from owning the brand, IE Rolex or Mercedes.
One product /brand – many Intellectual Property rights
- Trade marks: NOKIA, Product “208”, Start-up tone
- Copyright: Software, User manuals, Ringtones, Start-up tone, Images
- Patents and utility models: Data-processing methods, Operating system, Operation of user interface
- Designs: Form of overall phone, Arrangement and shape of buttons, Position and shape of screen
- Trade secrets: Some technical know-how kept “in-house” and not published
What do Brands Convey?
Brands convey several levels of meaning.
- Attributes: brings to mind certain attributes – eg Mercedes – expensive, well built etc
- Benefits: Attributes must be translated into functional and emotional benefits eg attribute ‘durable’ could be translated into functional benefit – won’t have to buy another car for years. Expensive – translates into emotional benefit – car makes me feel important and admired
- Values: says something about the producer’s values. Mercedes – prestige, safety
- Culture: may represent a certain culture. Mercedes – German culture – organised, efficient, high quality
- Personality: can project a personality. Mercedes – no nonsense boss
- User: suggests the kind of consumer who buys / uses product – eg 55 year old executive
(Kotler, 2003, p.419)
Key Differentiating Factors for a New Product
DIFFERENTIATION is the act of designing a set of meaningful differences to distinguish the company’s offering from competitors’ offerings.
– Kotler (1997)
- The product represents a functional improvement on competing or substitute products
- The product and/or its labeling has an attractive design
- The new product is properly branded, promoted and advertised
- The new product is readily available to customers in the main retail shops
- A number of after-sales services are provided that make the product appealing to consumers
How Brands Create Competitive Advantage
Through product performance:
- Investment in R&D
- Development of new technologies
Examples: Sony, 3M, Gillette
Through Non-product related performance:
- Understand consumer motivations
- Appealing images
- Image associations to allow distinction
Examples: Coca-Cola, Lush, Burberry
Why Brands Matter to Consumers
- Signal of Quality
- Identification of Product Source
- Product maker is assigned responsibility
- A promise
- Risk reducer
- Symbolic Device
- Search cost reducer
Why Brands Matter to Manufacturers
- Identifying, handling and tracing
- Source of competitive advantage
- Legally protecting unique features
- Signal of quality to satisfied consumers
- Source of financial returns
- Product is given unique associations
- Characteristics of Brands
- Brands reside in the minds of the consumer
- Rooted in reality but reflecting our strangeness
- Brands provide a meaning and a label to a product
- Consumers must be able to perceive differences among brands in the same product category
Brands can be:
- People & Organizations
- Services / Physical Goods
- Sports, Arts & Entertainment
- Online products and services
- Geographic locations
- Retailers and distributors
Branding vs Marketing
Marketing may contribute to a brand, but the brand is bigger than any particular marketing effort. The brand = remains after the marketing has swept through the room. It’s what sticks in your mind associated with a product, service, or organization—whether or not, at that particular moment, you bought or did not buy.
The brand is ultimately what determines if you will become a loyal customer or not.
The marketing may convince you to buy a particular Toyota, but it is the brand that will determine if you will only buy Toyotas for the rest of your life.
On the surface, branding seems to be a cost centre, but the return is loyalty, and more:
- Sales people whose jobs are easier and more effective,
- Employees who stay longer and work harder,
- Customers who become ambassadors and advocates for the organization.
Brand equity represents the total value that accrues to a product as a result of a company’s cumulative investments in the marketing of the brand.
Brand equity can also be thought of as an asset representing the value created by the relationship between the brand and its customers over time.
The stronger the relationship the greater the equity.
Usually global brands are high in brand equity.
- Has achieved success in a single national market.
- Can be created by local or global companies
- Can represent significant competitive hurdles to global companies entering a new market.
- Growing national pride (or ethnocentrism) can favour local products and brands.
International or ‘Pan-Regional’ Brands
Are offered in several markets in a particular region.
- Asian Branding: capitalizes on Asian pride and confidence; employ a mix of cultural symbols from different Asian countries; often utilizes also a Western connection.
- Euro Branding: marketed across Europe with the same brand name and formula, packaging, positioning and advertising strategy (standardization & homogenization)
How Brands are Created?
- Determine the desired Brand Position
- Develop a Brand Identification
- Creating Brand Image
In Marketing, Positioning is the technique in which marketers try to create an image or identity for a product, brand or a company. Brand Positioning “is the standing of a brand in comparison with its competitors in the minds of consumers, prospects and other stake holders.”
Positioning Strategies: Category Positioning, Image Positioning, Unique Product Feature Positioning, Benefit Positioning.
In Marketing, Positioning is the technique in which marketers try to create an image or identity for a product, brand or a company. Brand Positioning is the standing of a brand in comparison with its competitors in the minds of consumers, prospects and other stake holders.
- Category Positioning: Here. the Brand defines, creates or owns a category or sub product category. Xerox, Pepsi, Dominos; these names help easily identify the product category, and have become a generic name. A smaller sized pesi or coke can be another sub product category.
- Image Positioning: Positioning differentiates on the basis of a created association. Image has to be creative, realistic and should be able to build an association with the brand. Example, Marlboro cowboy.
- Unique Product Feature Positioning: Based on elements unique to a product or a company. May highlight tangible or intangible product features. E.g. Wal-Mart’s ‘Always low prices’ positioning.
- Benefit Positioning: Based on benefits, advantages that allow a product to satisfy customers’ needs, wants, or desires. Experiential, functional or symbolic benefits can be the basis of brand positioning. Example: For adults concerned about oral hygiene, Listerine is the one brand of mouthwash that not only stops bad breath but also helps prevent gum disease.
Developing Brand Identification
Brand Name and Symbol chosen to represent a brand need to reflect the position of the brand. They work as identification cues. Memorable Brand names and symbols go a long way in building the brand image.
Choosing a Brand Name
What does it mean? What performance/ expectations/ associations does it evoke? What degree of preference does it create?
Deciding on Brand Name
Suggest something about the product’s benefits – e.g. Head and Shoulders
Suggest product qualities – e.g. KFC
Simple and Easy to pronounce – e.g. Nike
Distinctive – e.g. Monster
May create imagery
Symbols greatly increase brand recognition. Symbols could mean logos, trade marks, characters, etc.
Pillsbury’s Doughboy Creates an Identity for the Brand
Brands are represented by Logos
Logos are distinctive graphic designs used to communicate a product, company, or organisation identity.
Creating a Brand Image
Brand image is everything. It is the sum of all tangible & intangible traits — the ideas, beliefs, values, prejudices, interests, features & ancestry that make it unique. It is an impression created by brand messages and experiences and assimilated into a perception or impression of the brand.
Creating or revitalizing a positive brand image is a basic component of every business — and lays a foundation on which companies can build their future.
Brand image is everything. It is the sum of all tangible & intangible traits — the ideas, beliefs, values, prejudices, interests, features & ancestry that make it unique.
A brand image visually & collectively represents all internal & external characteristics — the name, symbol, packaging, literature, signs, vehicles & culture.
It’s anything & everything that influences how a brand or a company is perceived by target constituencies — or even a single customer.
Its about experience
Starbucks: “We have identified a third place, and I really believe that sets us apart. The third place is that place that’s not work or home. It’s the place our customers come for refuge.”
Harley Davidson: “What we sell is the ability for an 43-year-old accountant to dress in black leather, ride through small towns and have people be afraid of him/her.”
Hertz Rental Car: “Renting a car changed into a convenient and time-saving experience. The car itself doesn’t matter.”
Individual branding – eg Dove, Fairy, Crest
Family branding – Heinz, Microsoft, Google Maps
Corporate brands – BBC, Tesco, IBM, HSBC
Types of Brands
Generic product: no means of identifying the company – eg plain flour. Item characterized by plain label, with no advertising and no brand name
Manufacturers’ brand: brand name owned by a manufacturer or other producer (Example: Whirlpool, Heinz, Cadbury)
Private brands (Distributor, own label): brand name placed on products marketed by wholesalers and retailers (Kenmore, Craftsman are Sears private brand). These are developed by wholesalers, distributors, dealers, retailers e.g. Supermarkets, Argos, Gap
Family brand: brand name that identifies several related products (Heinz is a popular Family Brand)
Individual brand: unique brand name that identifies a specific offering within a firm’s product line and that is not grouped under a family brand (Colgate-Palmolive uses Individual Branding for Soaps)
Many companies identify specific attributes that should be linked to their brands and emphasised in brand communication. Brand Attributes are the bullet-point selling-type features listed in brochures or in an advertisement. They state the specific benefit to the user from purchasing or using the brand.
Physical attributes can be encountered in many areas like packaging, product performance or superior value. For instance, Domino’s Pizza promises 30 minutes delivery.
Brands are constructed of two main attributes
- Intrinsic attributes: functional characteristics of a proposition, such as its shape, performance and physical capacity. If any of these intrinsic attributes were changed this would directly alter the proposition
- Extrinsic attributes: if changed, do not alter the material functioning and performance of the proposition. These include the brand name, marketing communications, packaging, pricing, and mechanisms that enable customers to form associations and give meaning to the brand
- Target and insights (Consumers): Define target, need states, competitors and insights.
- Features (Product Features): Product-focused strengths, claims, differences
- Functional (Functional Benefits): “So what do I get?”
- Emotional (Emotional Benefits): “So how does that make me feel?”
Tangible attributes: Design, Performance, Ingredients /components, Size / shape, Price, Marketing communication
Intangible attributes: Perceived value, Brand image, Memories associated with the brand, Perceptions and impressions of the user. Brand managers primary responsibility is to influence intangible attributes. This is important for brand building because it is more likely to involve consumers emotionally, and it is also difficult for competitors to copy.
Brand Values are the emotional benefits and intangible benefits which connect the consumer to the brand.
- Reputation Value: Perceived quality of product features.
- Experiential Value: Customer experiences.
- Relationship value: Firm is a long term partner that has customer interests.
- Symbolic value: Imbibing of values and attitudes
Exploiting Brand Value: Focused brand leverage and Diversified brand leverage.
- Focused brand leverage: Focused brand leverage depends on owning and broadening the category and capturing all occasions of use. E.g. Starbucks
- Diversified brand leverage emphasises creating a golden thread; building high-credibility personalities; and aggressive leveraging. E.g. Disney – Mickey Mouse, Goofy and other characters strike an emotional chord for all ages. It has leveraged beyond animation to include multiple theme park sites, professional sports franchises.
Personality refers to a set of human characteristics that are associated with a brand name. Personality is how the brand behaves. Companies uses brand personality to identify with their ideal consumers. Brand has a personality, character, tone of voice, its own style, etc.
Personality-like traits associated with brands:
- Volvo – safety
- Nike – the athlete
- BMW – performance
- Levi’s 501 – dependable and rugged
Aaker’s brand personality framework suggests that there are five dimensions of brand personality – sincerity, competence, excitement, sophistication and ruggedness.
- Sincerity: Disney, Cadbury, Amazon
- Excitement: Tesla, Nike, Red Bull
- Competence: Google, Intel, Volvo
- Sophistication: Rolex, Gucci, Apple
- Ruggedness: Harley Davidson, Timberland, Jeep, Marlboro
A successful brand is nothing more than a special relationship. Successful brands have good Customer Relationships and are able to retain Customers. Loyalty is the reward of consumer relationship.
- Brand Recognition: Consumer awareness and identification of a brand.
- Brand Preference: Consumer reliance on previous experiences with a product to choose that product again.
- Brand Insistence: Consumer refusals of alternatives and extensive search for desired merchandise.
Brand Equity is the component of overall preference not explained by objectively measured attributes; and the set of consumer associations & behaviours that permits the brand to earn greater volume or margins than it could without the brand name.
Pros and Cons of Branding:
- Advantages: Increases loyalty, can charge HIGHER PRICES, successful brand names CAN link to product (e.g. “Bisleri”), can Launch complimentary products in same brand name – e.g. shampoo; conditioner; hairspray.
- Drawbacks: Cost of developing and establishing it, Can be copied/ near copied, could get a bad name as well as a good one if quality is not kept up
Brand Experiences & Society
The latest trend in branding is experiences where companies let potential buyers experience their products in an engaging environment so that he gets a more hands-on experience of the product or service. Expert marketers acknowledge that today most consumers seek brands that provide them with unique and memorable experiences.
For example, it is common for buyers to go to a store and try out the various trendy outfits so that they can see for themselves how they look wearing those attire. Full length mirrors all around, lights at strategic places further enhances the consumers overall experience. Same goes for gym-wear; when consumers walk into Reebok stores and try out the shoes and the various gym wear in a gym like setting, it makes it easier for the buyer to make a decision. Visits to the art gallery, attending a concert, are other examples of experiences.
Luxury weddings is another upmarket segment where organizers creating fantasies and dreams for the couple. Through these romantic fantasies, the couple also flaunt their aesthetic values and lifestyle choices. Sellers of luxury goods are particularly good at arousing strong emotions that we generally attach to expensive products. On several occasions, despite feeling the financial pinch, people buy luxury items to show off, or to be part of an elite group, or to reward oneself for an accomplishment. So if you’re planning to buy a high-end car, the feeling is even more aroused when you take a test drive of the car.
Marketers know that customers are emotional people, and in this style of branding the focus is more on customer experiences, and so the marketing efforts are designed to appeal to the various senses. Companies use the various Experience Providers (logo, design, packaging, building, website) to create the create feeling during a potential customers consumption experience.
While ‘experience’ is definitely a promising trend, next we take a look at the importance of design for any business and its impact on the society.
Keller, K.L. (2012), Strategic Brand Management: A European Perspective, FT Pearson
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