Concept of Brand
Introduction
The
word “brand”, when used as a noun, can refer to a company name, a product name,
or a unique identifier such as a logo or trademark.
The
concept of branding also developed through the practices of craftsmen who
wanted to place a mark or identifier on their work without detracting from the
beauty of the piece. These craftsmen used their initials, a symbol, or another
unique mark to identify their work and they usually put these marks in a low
visibility place on the product.
The
Meaning of Brands
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.
One
complete definition of a brand is as follows:
“A name, term, sign, symbol or
design, or a combination of these, that is intended to identify the goods and
services of one business or group of businesses and to differentiate them from
those of competitors”.
Example
MacDonald
sums this up nicely in the following 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”
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.
What is Branding?
Branding
is the business process of managing your trademark portfolio so as to maximize
the value of the experiences associated with it, to the benefit of your key
stakeholders, especially current and prospective:
• employees
• customers
• stock/share holders
• suppliers
• intermediaries
• opinion leaders
• local communities
• purchasers and licensees
Experts
argue as to which stakeholders should be the main focus of the branding
process, but this is probably the wrong question as their experiences are all
inter-related:
• Employees
- the more your employees value your brands and understand
what to do to build them, the more your customers, suppliers, local communities
and opinion leaders will value them. The more attractive your brands are to
potential employees, the more they are likely to want to work for you
• Customers
- the more your customers value your brand, the more they
will buy your products and services, and recommend them to other people. They
will also pay a premium for them and make the lives of your employees easier.
This, in turn, will enhance the value of your brands to prospective purchasers
and licensees. Research has shown that strong brands are more resistant to
crises of reputation
• Stock/share
holders - strong brands multiply the asset value of your company
(90% of the asset value of some major corporations lies in their intellectual
property), and assure them that your company has a profitable future.
They
also allow you to afford to give competitive dividends to your current stock/share
holders
• Suppliers
- suppliers like to be associated with strong brands as
this benefits their own reputation in the eyes of other current or potential
customers. You are therefore likely to get better service at a lower total
acquisition cost
• Intermediaries
- retailers, distributors and wholesalers value strong
brands as they improve their own profit margins. They are likely to give you
more “air time” and shelf space, thus enhancing further the value of your
brands in the eyes of your current and prospective customers
• Opinion
leaders - the media, politicians and non-government organisations are more
respectful of strong brands
• Local
communities - supportive local authorities can make your life easier in
many ways, and offer you better deals, if you have prestigious brands. Your
local communities provide you with your work force and can be highly disruptive
if they perceive you as damaging their environment
• Purchasers
and licensees - the question prospective purchasers and licensees ask is
“how much more profit can I get for my products and services sold under this
brand than under any brand I might build?” Strong brands can be spectacularly
valuable.
Characteristics of Brands
Our
definition of a brand adheres to a model which shows the extent to which a
product or service can be augmented to provide added value to increasing levels
of sophistication. This model, views a brand as consisting of four levels
• generic
• expected
• augmented
• potential
The
generic level is the commodity form that meets the buyer,
or user’s basic needs, for example the car satisfying a transportation need.
This is the easiest aspect for competitors to copy and consequently successful
brands have added values over and above this at the expected level.
Within
the expected level, the commodity is value engineered to satisfy
a specific target’s minimum purchase conditions, such as functional
capabilities, availability, pricing, etc. As more buyers enter the market and
as repeat buying occurs, the brand would evolve through a better matching of
resources to meet customers’ needs (e.g; enhanced’ customer service).
With
increased experience, buyers and users become more sophisticated, so the brand
would need to be augmented in more refined ways, with added
values satisfying non-functional (e.g. emotional) as well as functional needs.
For example, promotions
might be directed to the user’s peer group to reinforce his or her social
standing through ownership of the brand.
With
even more experience of the brand, and therefore with a greater tendency to be
more critical, it is only creativity that limits the extent to which the brand
can mature to the potential level.
Brand
Evolution
This is evolved from the company’s core vision and values,
building on what is important to the organisation, then translated into
impactful, purposeful design.
Brand Evolution is a collaboration of strategists, and
people specialists who come together to work with organisations to help them
identify what makes them unique, their positioning in the market place and
competitive advantage.
Branding challenges and opportunities
Brands
build their strength by providing customers consistently superior product and
service experiences. A strong brand is a promise or bond with customers. In
return for their loyalty, customers expect the firm to satisfy their needs
better than any other competitors.
Brands
will always be important given their fundamental purpose – to identify and
differentiate products and services. Good brand makes people’s lives a little
easier and better. People are loyal to brands that satisfy their expectations
and deliver on its brand promise. The predictably good performance of a strong
brand is something that consumer will always value.
The
challenges to brands
1) The shift from strategy to tactics: – With the increasing pressure to generate
ever-improving profitability, it is often considered a luxury for managers to
develop long-term strategic plans. This is further exacerbated by short-term
goal setting, which is frequently designed primarily for the convenience of the
financial community.
2) The shift from advertising to promotions: – As a consequence of the increasing pressure on
brand manager to achieve short-term goals, there is a temptation to cut back on
advertising support, since it is viewed as a long-term brand-building
investment, in favour of promotions which generate much quicker short-term
results.
3) On-Line shopping: – The Internet is facilitating on-line shopping.
On-line shopping is different from traditional mail order because:
•
Brands are available all the time and from all over the world;
•
Information and interactions are in real time;
•
Consumers can choose between brands which meet their criteria, as a result of
selecting information which is in a much more convenient format for them,
rather than the standard catalogue format.
This
poses threats to brands, some components of added value, agent or the retail
outlet which originally added value by matching consumers with suppliers, may
be eliminated.
4) Opportunities from technology: – Brand marketers are now able to take advantage
of technology to again a competitive advantage through time. Technology is already
reducing the lead time needed to respond rapidly to changing customers need and
minimizing any delays in the supply chain.
5) More sophisticated buyers: – In business-to-business marketing, there is
already an emphasis on bringing together individuals from different departments
to evaluate suppliers’ new brands. As inter departmental barriers break down
even more, sellers are going to face increasingly sophisticated buyers who are
served by better information system enabling them to pay off brand suppliers
against each other.
6) The growth of corporate branding:- With media inhabiting individual brand
advertising, many firms are putting more emphasis on corporate branding,
unifying their portfolio of brands through clearer linkages with the corporation,
which clarifies the those all the line brands adhere to. Through corporate
identity program functional aspects of individual brands in the firm’s
portfolio can be augmented, enabling the consumer to select brands through
assessment of the values of competing firms. Firms developed powerful corporate
identity programmes by recognizing the need first to identify their internal
corporate values, from which flow employee attitudes and specific types of
staff behavior secondly, to devise integrated communication programmes for
different external audiences.
Brand
Strategies
Branding is crucial for products and
services sold in huge consumer markets. It’s also important in B2B because it
helps you stand out from your competition. Your brand
strategy brings your competitive positioning
to life, and works to position you as
a certain “something” in the mind of your prospects and
customers.
Think about successful consumer brands like
Disney, Tiffany or Starbucks. You probably know what each brand represents. Now
imagine that you’re competing against one of these companies. If you want to
capture significant market share, start with a strong brand strategy or you may
not get far.
Successful branding also creates “brand
equity” – the
amount of money that customers are willing to pay just because it’s your brand.
In addition to generating revenue, brand equity makes your company itself more
valuable over the long term.
Best Case
|
Neutral Case
|
Worst Case
|
Prospects and customers know exactly what you deliver. It’s
easy to begin dialogue with new prospects because they quickly understand
what you stand for.
You acquire customers quickly
because your prospects’ experience with you supports everything you say.
You can charge a premium because
your market knows why you’re better and is willing to pay for it.
|
The market may not have a consistent view or impression of
your product and company, but in general, you think it’s positive.
You haven’t thought a lot about
branding because it doesn’t necessarily seem relevant, but you admit that you
can do a better job of communicating consistently with the market.
You’re not helping yourself but
you’re not hurting yourself either.
|
You don’t have a brand strategy and it shows. It’s more
difficult to communicate with prospects and convince them to buy.
They don’t have an impression of
your product/service or why it’s better.
What you do, what you say and how
you say it may contradict each other and confuse your prospects.
Competitors typically have an
easier time acquiring customers.
|
Develop your brand around
emotional benefits
·
List the features and benefits of your product / service. A
feature is an attribute – a color, a configuration; a benefit is what that
feature does for the customer.
·
Determine which benefits are most important to each of your
customer segments.
·
Identify which benefits are emotional – the most powerful brand
strategies tap into emotions, even among business buyers.
·
Look at the emotional benefits and boil them down to one thing
that your customers should think of when they think of you. That’s what your
brand should represent.
Define your brand personality,
story and positioning statements
·
Think of your brand as a person with a distinct personality.
Describe him or her, then convey these brand personality traits in everything
you do and create.
·
Write positioning statements and a story about your brand; use
this brand messaging throughout your company materials.
·
Choose colors, fonts and other visual elements that match your
personality and create your corporate identity.
·
Determine how your employees will interact with prospects and
customers to convey the personality and make sure your brand “lives” within
your company.
After Brand Strategy
Together with your
competitive positioning strategy, your brand strategy is the essence of what
you represent. A great brand strategy helps you communicate more effectively
with your market, so follow it in every interaction you have with your
prospects and customers.
If you’re wondering how to
choose a great brand name, complete your written brand strategy before you
start the naming process. Since your name is an extension of your brand, it’ll
be much easier to evaluate the quality of your name choices (instead of
starting with the name) with it completed.
The information you have provided is very helpful at all thank you very much for sharing useful information with us. aircon servicing
ReplyDeleteMultiproduct branding strategy, also known as family branding, or corporate branding is when a company uses one brand name for all of its products within a class. For example, the brand name Sony is used on most if not all of their products.
ReplyDeleteThis comment has been removed by the author.
ReplyDelete